Options Trading Strategy №3: Buying PUT Options
Strategy Description
Buying a "naked" PUT option is logically similar to buying a "naked" CALL option, with the difference being:
The buyer of the PUT option expects the underlying asset price to decline.
Risk and Return Characteristics
Similar to buying a naked CALL option,
The maximum risk for the buyer of the PUT option is fixed in advance, equal to the premium paid;
While the theoretical profit has no upper limit.