OPTION STRATEGY : LONG PUT 2022
OPTION STRATEGY : LONG PUT
STRATEGY : LONG PUT
Buying a Put is the opposite of buying a Call. When you buy a Call you are bullish about the stock / index. When an investor is bearish, he can buy a Put option. A Put Option gives the buyer of the Put a right to sell the stock (to the Put seller) at a pre-specified price and thereby limit his risk.
ANALYSIS: A bearish investor can profit from declining stock price by buying Puts. He
limits his risk to the amount of premium paid but his profit potential remains unlimited. This
is one of the widely used strategy when an investor is bearish.