A put is an option contract between buyer and the seller for exchange an underlying security, at a specified price, by a predetermined date. Two parties having, one party is the buyer of the put option and the second party is the seller of put option. Buyer has the rights, but not the obligations, to sell the asset at the strike price, while the seller has the obligation to buy the asset at the strike price if the buyer sells the option.
When an investor thinks that underlying asset price will decline, so he or she purchases the put option and if an investor think that underlying asset price will increase, so he or she prefer the call option.
When an investor thinks that underlying asset price will decline, so he or she purchases the put option and if an investor think that underlying asset price will increase, so he or she prefer the call option.
