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Define: Put Options



Put Options are contracts that give you the right, but not the obligation, to sell the underlying stock (or asset) at a fixed price anytime before expiration.

Put Options rise in value when the price of the underlying stock drops. As no margin is needed to buy Put Options and Put Options have limited loss potential, buying Put Options is a safer and easier way to "short" the underlying stock or asset. Put Options can also be shorted (or written) in order to speculate on a rise in a stock's price.

Read the full tutorial on Put Options.