It's possible to hedge portfolio against the crisis by buying put-options. One thing that worrying me - what if insurers will be bankrupt when you need them the most.
This crisis insurance (put-options) will be activated when banks, brokers and economy having very bad time. It could be quite possible that option writers will just went bankrupt and you got nothing.
I recently watched Mark Spitznagel talk that says similar things:
- ... my solution to this I don't take a single entity counterparty risks ...
- ... It's like a buying Titanic insurance from someone who's on Titanic, that's not a great idea ....
So, as far as I understand he buys put options from multiple different providers. How he does that - where can you find different put options writers? And ideally how he owns those contracts directly, bypassing the broker (to avoid broker bankruptcy risk)?
Usually you transact such things via broker and don't even know who's the put options writers. Is there other way to buy put options for a small investor? When you knowing who's the put option writer and diversify by having multiple different writers?