Strategy Overview
Medium RiskBeginner FriendlyBearish
A long put is the most basic bearish options strategy. You buy a put option to profit from downward movement or to hedge existing positions.
Max Profit
Strike price - premium (if stock to $0)
Max Loss
Premium paid
Breakeven
Strike - premium paid
Probability
~35% win rate
hist. est.
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Example Setup Calculator
$
Debit Paid
$350
Max Profit
$9650
Max Loss
$350
Breakeven
$96.50
Strategy Components
BUY ATM PUT
Buy ATM or OTM put
When to Use
- You are bearish on the stock
- You want to hedge long positions
- IV is relatively low
- You expect a significant move down
Best Market Conditions
- Low IV
- Bearish catalyst expected
- Breaking technical support
Best Practices
- Give yourself time - 60+ DTE preferred
- Choose strike based on support levels
- Use as insurance for long positions
- Consider put spreads to reduce cost
Ready to Trade?
Review Long Put and practice it in paper trading with the school workflow.
Paper Trading