To safeguard investments, stock owners who believe the price of their stock will go down during an option period will purchase a:

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A put option gives the owner the right, but not the obligation, to sell their stock at a specific price (known as the strike price) during the option period. If the stock price falls below the strike price, the owner can exercise their put option and sell the stock at the higher strike price, protecting their investment. Therefore, a put option can be an effective way to safeguard investments in the case of a declining stock price.

To Safeguard Investments, Stock Owners Who Believe the Price of Their