Buy To Open Put Example May 2026

Strike Price minus Premium (In this example: $93).

Your maximum risk is capped. You simply lose the $200 you paid to open the position. Why Traders "Buy to Open" Puts buy to open put example

Your right to sell at $95 is now very valuable. The option is worth at least $15 per share ($95 strike - $80 market price). Strike Price minus Premium (In this example: $93)

The price at which you have the right to sell the stock. Why Traders "Buy to Open" Puts Your right

A "Buy to Open" (BTO) put order is the classic way to bet against a stock or hedge a position you already own. When you execute this trade, you are paying a premium to acquire the a specific stock at a set price. The Scenario

If you already own 100 shares of XYZ, buying this put acts as an insurance policy. No matter how low the stock falls, you are guaranteed the ability to sell at $95.