Investing in the stock market can be a lucrative way to grow your wealth, but it also comes with risks. One strategy that investors can use to protect themselves from potential market downturns is by investing in put options. A put option gives you the right, but not the obligation, to sell a stock at a specific price (known as the strike price) by a specific time – usually within a few months.
To invest in puts, you need to have a basic understanding of options trading. Options trading is a self-directed way to invest for those looking to diversify. Here's a guide to understanding options trading and to help you get started with investing in puts.