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Derivatives

Put Option

A contract giving the right to sell a stock at a specified strike price by an expiration date.

In depth

Put buyers profit when the underlying falls below strike − premium. Often bought as portfolio insurance. Put sellers collect premium but obligate themselves to buy stock at strike if assigned — equivalent to a "cash-secured put" income strategy.

Frequently asked about Put Option

What is Put Option?

A contract giving the right to sell a stock at a specified strike price by an expiration date. Put buyers profit when the underlying falls below strike − premium. Often bought as portfolio insurance. Put sellers collect premium but obligate themselves to buy stock at strike if assigned — equivalent to a "cash-secured put" income strategy.

Why does Put Option matter for investors?

In derivatives, Put Option is one of the building blocks investors use to compare opportunities and assess risk. Understanding it helps you read research notes, earnings reports, and market commentary without getting lost in jargon.

How is Put Option used in practice?

Put buyers profit when the underlying falls below strike − premium. Often bought as portfolio insurance.

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