GO
Loading...

Put Options as Protection: CNBC Explains

You may have heard traders talk about buying “put protection” while watching CNBC or hearing financial commentary. Put options are essentially bets that a stock will go down, but they can also be used by investors to hedge their portfolio against a downward move in stock price. How can put options be used as investment insurance? Salman Khan of the Khan Academy explains.

From this video, you’ll understand:

  • What it means to buy “put protection”
  • How the profit and loss of a put option compares to purchasing a stock



Contact CNBC Explains

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More

Latest Special Reports

  • Alibaba Group headquarters in Hangzhou, China

    In-depth coverage on Alibaba's IPO, including roadshow coverage, expert analysis, and Alibaba's stock price.

  • With more than 1,600 ETFs now on the market, learn more about how advisors and investors are profiting from the ETF boom.

  • Unlock the keys to building a successful long-term financial plan: manage your money, grow your money, and protect it.

Central Banking Explained

Corporate Accounting Explained