Long put
Pay a premium for the right to sell; profit grows as the price falls.
Bearish1 legDebit
Illustrative: underlying at 100, strikes every 2.5, 45 days to expiry, implied volatility 25%, model prices. One lot = 100 shares.
Key figures
| Opens for | a debit of $322 |
|---|---|
| Max profit | +$9,678 if the shares went to zero |
| Max loss | −$322 |
| Break-even | 96.78 |
| Position delta today | −46 shares |
| Outlook | Bearish |
The legs
| Action | Quantity | Option | Model price |
|---|---|---|---|
| Buy | 1 | 100 put, 45 days | 3.22 |
How it works
Pay a premium for the right to sell; profit grows as the price falls. Single options are the building blocks: the right to buy (a call) or to sell (a put) 100 shares at a fixed price, the strike, until expiry. Combined with shares, they add income or protection to a holding.
When it fits
It suits a view that the underlying stays down or falls before expiry.
What can go wrong
The most it can lose at expiry in this example is −$322. Bought options lose value as time passes, so the move has to come before expiry.
Building it in Trident
In the Strategy Lab, choose long put and the days to expiry. Trident applies these strike rules to your live chain, prices each leg and draws the trade on the risk graph, where you can drag the days to expiry, change implied volatility or switch on the crash band. When it looks right, send it to order management; nothing reaches your broker until you send it.
Frequently asked questions
What is a long put?
Pay a premium for the right to sell; profit grows as the price falls.
What is the maximum loss on a long put?
In this illustrative example it is −$322 for one lot at expiry.
Where does a long put break even?
With the underlying at 100 in this illustrative example, the break-even at expiry is 96.78.
Can I build a long put in Trident?
Yes. Pick it in the Strategy Lab and Trident chooses the strikes from your live chain, prices the legs and draws it on the risk graph.
Illustrative example with model prices, not a recommendation. Options carry risk of loss. See the risk disclosure.