Just found this post but strong agree. I have previously suggested (like 3 years ago) that EAs should not hold facebook stock (now META) and that we should probably have something like rolling 1 year put options. That’s easier to do in public markets and we can just ask some wealthy EAs or some other organization to put this position on. What I mean here is that we can hedge out our specific facebook risk (and long the market, other tech/​social media companies and figure out other hedges we want).
Hedging a private company is much, much harder. We could have shorted $FTT futures but this is insanely risky and could blow up before you get the benefit of your hedge (better for us to just have gotten whatever amount of FTT we could get and liquidate it) and this runs into problems you spoke about.
Hedging against a market downturn (lots of EA net worth was lost here) is just very difficult as well.
Just found this post but strong agree. I have previously suggested (like 3 years ago) that EAs should not hold facebook stock (now META) and that we should probably have something like rolling 1 year put options. That’s easier to do in public markets and we can just ask some wealthy EAs or some other organization to put this position on. What I mean here is that we can hedge out our specific facebook risk (and long the market, other tech/​social media companies and figure out other hedges we want).
Hedging a private company is much, much harder. We could have shorted $FTT futures but this is insanely risky and could blow up before you get the benefit of your hedge (better for us to just have gotten whatever amount of FTT we could get and liquidate it) and this runs into problems you spoke about.
Hedging against a market downturn (lots of EA net worth was lost here) is just very difficult as well.
Good post.