Q: What are Put Options?

A: Businesses find it extremely difficult, if not impossible to insure accounts receivable of a financially distressed company or when dealing with a high concentration.

An excellent solution to consider may be Account Receivable Puts which offer 100% non-cancellable cover on both distressed and investment grade names from 6 months to 3 years. AR Puts provide single debtor protection and are available mainly on Public companies or large Private companies with public debt.

Puts are rather costly, but can provide a sound solution to a risky opportunity.