Married Put
A married put pairs 100 shares with a long put bought against them. The put is an insurance policy: it guarantees a selling price no matter how far the stock falls, while leaving the upside untouched. You pay the premium for that certainty.
When it makes sense
- You want to own the stock through a risky stretch with a hard floor
- You're holding for a dividend and want the downside insured
- IV is low, making protection historically cheap
How it works
Buy 100 shares and one put, typically at or slightly below the stock price. Your worst case is locked: (stock cost − strike) + premium. Breakeven is the stock cost plus the premium — the stock must rise enough to cover the insurance.
Risk & reward
Maximum loss: strictly capped and known up front. Maximum profit: unlimited, reduced by the premium. The cost of rolling protection every month adds up — married puts suit defined windows of risk (events, concentrated positions), not permanent hedging.
Worked example
Buy 100 shares at $120 and the 45-day $115 put for $2.50 ($250). Stock at $90: sell at $115 — total loss capped at $750 instead of $3,000. Stock at $135: profit $1,250, just $250 less than unhedged.
Scan the market for married puts
OptionClaws ranks every married put in the market by return, probability, and liquidity — free for 7 days.
More strategies
Educational content, not investment advice. Options involve substantial risk — see our Terms of Service.