Concave (CM) represents sale of portfolio insurance.

Notes5, P60, Convex (CPPI) represents purchase of portfolio insurance. .Concave (CM) represents sale of portfolio insurance. --it’s easy to understand CPPI purchase a portfolio insurance, since it has a floor value to guarantee portfolio . Why says CM represents sale of insurance?

In CM - you buy when the market is down. so when the market sentiments are low, instead of getting out of the market you are getting more into it. So it’s like sale of insurance. I know it does not help, but that’s the way I remember it.

when you sell a put you sell insurance, so when the market is down you lose as the insurance provider… in the same sence (and kind of on LaGrande’s point) when the market is down the CM investor buys - providing liquidity in the down market (and insurance to the sellers, i.e. the opposite side of the market trade)

Very simple. CPPI is purchaser of insurance since there is a floor value. CM is a mirror image of CPPI, so its the sale of insurance. the end.

I understand the sale of insurance when buying in down market for CM. How to understand sale of insurance when market is up?