Hacker News new | ask | show | jobs
by throwaway894345 2247 days ago
So if the fund declares bankruptcy, who has to deal with the oil?
1 comments

The contracts will be liquidated first, if possible. If the fund is still left holding some then the exchange and market makers will absorb the losses with their excess capital and insurance policies.

It takes special clearance to even trade contracts that are physically settled. Most of the time these contracts are just cash-settled instead.