Put option
By Jude Wallis
A put option gives its buyer the right, but not the obligation, to sell an underlying asset at a fixed strike price by a stated expiry. The buyer pays a premium for that right.
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At expiry, per-share intrinsic value is the greater of strike minus spot and zero. Profit subtracts the premium. If spot is above the strike, the put expires unused and the loss is the premium on this sheet.
A long put is not a short sale. Short selling borrows the asset. A put pays a premium for a right.
How a put option works is the explainer. The put option calculator is the expiry payoff.