: A put is ITM if the stock price is below the strike price.
: Investors holding a stock may buy a put as "insurance." If the stock price plummets, the put allows them to sell at the higher strike price, limiting their downside. Risk and Reward : Max Profit : Occurs if the stock price falls to zero ( Max Loss : Limited to the premium paid. III. Selling Put Options: Income and Strategic Acquisition Put Option: What It Is, How It Works, and How to Trade how to buy and sell put options
: The buyer pays an upfront fee (premium) to the seller for this right. : A put is ITM if the stock price is below the strike price