Put Option

A contract allowing the owner to sell a financial asset at a specified price.  The owner has a specific date or a period of time to choose whether or not to exercise the option.   The owner of a put option hopes that the price of the stock falls relative to the strike price.  This allows the owner to sell the stock for a price above the market price, generating a profit.  Options can be used to increase risk or hedge against risk.  A put option is the opposite of a call option.