Put

Put or put options, are financial derivatives that  give the holder the right but not the obligation to sell the underlying security at a predetermined price (strike price) within a period of time. The seller(or writer) of a put option would assume the obligation to buy the underlying security at the strike price.

Buying a put is similar to taking a short position in the market, but the cost is only the premium paid, therefore buying puts are a popular way to hedge during times of uncertainty. They can also be used to speculate on a future decline in a security’s price.

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