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Long Puts for Beginners: Options Learning Center

Run time:  11:43

Description

The long put or protective put option strategy involves the outright purchase of a put option, where the goal is to profit from depreciation in the price of the underlying security.

Risk is limited to the premium paid (Net Debit) for 100 contracts of the long put option, while maximum profit is the difference between the strike price and the price of the put, which is achieved in the unlikely event the security goes to zero.

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Strategy At A Glance

Bearish
Price expected to fall.
Limited Profit
Profit is limited.
Limited Loss
Losses are limited.