Buy Put Option Example -

Imagine you own 100 shares of , currently trading at $150 . You are worried the price might drop after an upcoming earnings report. To protect your investment, you buy a put option: Strike Price: $145 (The price you can sell at) Expiration: 1 month from now Premium: $3 per share ($300 total for 100 shares) 📉 Scenario A: The Stock Price Drops If TechCorp shares tumble to $130 : Your shares are now worth $13,000 on the open market. Your put option allows you to sell them for $145 ($14,500).

If you'd like to see how this works for a you're watching, tell me: The ticker symbol (e.g., AAPL, TSLA) Your target sell price The timeframe you're considering buy put option example

You saved $15 per share (minus the $3 premium), limiting your loss significantly. 📈 Scenario B: The Stock Price Rises If TechCorp shares climb to $170 : You wouldn't use your option to sell at $145. You let the option expire worthless. Imagine you own 100 shares of , currently trading at $150