Conversely, a put option loses its value as the underlying stock increases and the time to expiration approaches. My goal is put options on stocks 3 month give you a basic understanding of what stock options areall about without hopelessly confusing you with unnecessary detaiThis article needs additional citations for verification. Please help improve this article by adding citations to reliable sources.
Unsourced material may be challenged and removed. (November 2015) ( Learn how and when to remove this template message)In finance, a put or put option is a stock market device which gives the owner of a put the right, but not the obligation, to sell an asset (the underlying), at a specified price (the strike), by a predetermined date (the expiry or maturity) to a given party (the seller of the put). This compensation may impact how and where products appear on this site, including, for example, the order in which they appear on category pages.
MoneyCrashers.com does not include all credit card companies or all available credit card offers, although best efforts are made to include a comprehensive list of offers regardless of compensation. Advertiser partners include American Express, U.S. Bank, and Barclaycard, among others.Advertiser Disclosure Close. The sale of put options can be an excellent way to gain exposure to a stock on which you are bullish with the added benefit of potentially owning the stock at a future date at a price below the current market price.
To understand how selling puts may benefit your investment strategy, a quick primer on options may be helpful to some.TUTORIAL: Options BasicsCall Options Vs. Put OptionsVery simply, an equity option is a derivative security that acquires its value from the underlying stock it covers. Owning a call option gives you the right to buy a stock at a predetermined price, known as the option exercise price. A put option gives the owner the right to sell the underlying stDefinition:A put option is an option contract in which the holder (buyer) has the right (but not the obligation) to sell a specified quantity of a security at a specified price ( strikeprice) within a fixed period of time (until its expiration).For the writer (seller) of a put option, it represents an obligation to buy theunderlying security at the strike price if the option is exercised.
The put option writer put options on stocks 3 month paid a premium for taking on the risk associated with the obligation.For stock options, each contract covers 100 shares. Note: This article is all about put options for traditional stock options. If you are looking for information pertaining to put options as used in binary option trading, please read our writeup on binary put options instead as there are significant difference between the two.
Buying Put OptionsPut buying is the simplest way to trade put options. When the optioHomeArticlesSelling Calls For IncomeSelling Puts For IncomeTop IdeasMy WatchlistYieldBoost RanksFREE registration required to continue.You have viewed pages within the last hours. To continue, please register at Stock Options Channel for unlimitedpage views and our free weekly newsletter, by entering your name and email address below.