Which of the following is a potential disadvantage of privately negotiated options?

Question

Quizplus · Accepted Answer

All of the given options are potential disadvantages of privately negotiated options. It can be difficult to find a counterparty willing to take the other side of the trade, and it may be necessary to investigate their creditworthiness to ensure they will be able to fulfill their obligations. Additionally, once a contract is entered into, it may not be possible to reverse out of the trade before the expiry date, which can be a disadvantage if market conditions change.

Which of the Following Is a Potential Disadvantage of Privately