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What options there are for protection of non-delivery or non-payment for deliverable forward contracts in the absence of clearing house? With volatile assets the spot price can be very different from delivery price. Motivation to fulfil the contract decreases as the difference between spot and delivery price increases.

Is the only option to require high enough margin/down payment that corresponds somewhat to the volatility of the underlying asset and the risk of each party involved in the contract? Is there some known model for this?

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    Lawyers, courts, and judges. – quid Jul 17 at 0:27
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Is the only option to require high enough margin/down payment

The short answer here is yes - the risk also has a technical term called counterparty risk. Assuming a perfect market, this should be already reflected in the price of the forward contract though.

If you want to learn more how you have a chance to hedge it on an institutional level i would recommend the Discussionpaper of the German Bundesbank No 35/2018: Mitigating counterparty risk.

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