Glossary › put option

Trading glossary · advanced

put option

A ticket that gives you the right, but not the duty, to sell something at a set price before a set date.

The fuller meaning

An option giving its buyer the right, not the obligation, to sell the underlying at the strike price up to or at expiry, for a premium. The buyer's loss is capped at the premium and gains grow as price falls; the put seller can lose up to the strike minus the premium if the stock collapses.

put option.

Related words

at the money · backtest · backwardation · basis · call option · contango · data snooping · delta · edge · entry trigger