What Does Buying A Put Mean at Buying

What Does Buying A Put Mean. Puts can be based on an individual stock or index. In general, you want to buy a put option when you have a bearish sentiment about a security.

Buying a put takes the short position. What a put option is when you buy a put option, you get the right to sell stock at a certain fixed price within a specified time frame. Some investors buy puts to place a bet that a certain stock's price will decline because put options provide higher potential profit than shorting the stock outright.

The owner of the put can sell the asset for more than the current market price. The underlying is the bank nifty. However, when you buy a put, this typically means that you anticipate the value of the stock will fall by the date of option expiry. A put option (or “put”) is a contract giving the option buyer the right, but not the obligation, to sell—or sell short—a specified amount of an underlying security at.