Why Would You - Buy A Put Option

Profit increases as the stock price crashes. 🛡️ Portfolio Protection (Hedging)

📍 A put option becomes "In the Money" (profitable) when the market price drops below your strike price. why would you buy a put option

Unlike shorting, you can't lose more than your initial investment. Profit increases as the stock price crashes

The most common reason to buy a put is betting that a stock's price will fall. Control many shares with relatively little cash. Limited Risk: You can only lose the premium you paid. why would you buy a put option

Investors use puts like an insurance policy for their existing holdings. Buying a put for a stock you already own. Floor Price: Locks in a minimum sale price for your shares.