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Personal Finance

What is a protective put?

Quick Answer

A protective put is a put option you buy on stock you own, acting as insurance against a price drop. Costs typically 1–4% of stock value for 1–3 months of protection — useful before earnings or to lock in gains without selling.

Protective put payoff at expiration showing floor.
Warren Team
Updated April 26, 2026
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Important Disclaimer:

The information provided is for educational purposes only and should not be considered as personalized financial advice. Warren is a registered investment advisor. Past performance does not guarantee future results. Please consult with a qualified financial advisor before making investment decisions.

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