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Definition

Put option

A Put option gives the Option holder the right to sell the asset/shares at a fixed exercise price to another person or firm within a specified period of time. Purchaser of a put option hopes that stock price will decrease.

Brealy and Myers said,” Put gives the right to sell the shares.

Bodie, Kane & Marous said,” A put option gives the holder the right to seller asset for a specified exercise price on or before some expiration date.”

Ross, Westerfield & Jaffe said,” A put gives the holder the right to sell the stock for a fixed exercise price.”

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