Big company profits to take a hit, page-6

  1. 1,383 Posts.
    My understanding is that all capital guaranteed funds buy insurance by turning over longish dated puts (I do not think they would sell calls). This is the extra cost you have to pay for on a capital guarantee.

    So if the puts do go into profit, the mms take the hit. Profits down for MBL and the other merchant banks.

 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.