Quote:
Originally Posted by Joekerr
Yes, I'm basically asking what protection do you have that the person you have a contract with doesn't tell you to eat a bag of dicks because he's just going to declare bankruptcy.
Not sure in the States, but in Canada, we have insurance through the government to cover up to $100K if we have that much in a bank account and the bank goes bust. Is there anything insurance wise (or any other means, not necessarily insurance) that allows you to be comfortable that the other party comes through without going the lawsuit route?
Because suing someone takes a lot of your own money, and if he/she doesn't have any significant assets anyways, its just a waste of your money since you get nothing at the end of the day. Contracts are only good if the other party has enough assets to cover what they say they are covering.
Also, can you as a buyer tell whether you are buying a covered vs naked call? Options have always really interested me, but I admit I'm too dumb at the moment to really understand them, so I appreciate the education you are giving me!
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Now THAT I'm not sure on. As for being able to tell whether it's a covered vs naked call - no, not that I'm aware of anyway. It's basically irrelevant to the purchaser - they're owed what they're owed.