A put option is a financial contract that gives the option buyer the right, but not the obligation, to sell a specified quantity of an underlying asset at a set price within a specified time. Put options are bought to profit from a decline in the prices of the underlying assets. They can also serve as a protection or insurance mechanism for an investor’s holdings in the underlying asset.
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Jenna Lofton, MBA is a stock trading and investment expert with over a decade of experience in the financial industry. She began her career as a financial advisor on Wall Street and now helps everyday investors make smarter financial decisions through StockHitter.com.
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