Put To Seller

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Dictionary Says

Definition of 'Put To Seller'

The exercise of a put option. Put to seller would usually occur when the strike price of the put is lower than the market value of the underlying security. At this point, the seller would have the option, but not the obligation to sell the asset to the option writer for a higher price than what is currently dictated by the market.
Investopedia Says

Investopedia explains 'Put To Seller'

For example, consider a situation where an investor buys puts to hedge downside risk in his or her position in stock A. The investor buys three-month puts on A with a strike price of $25 and pays a premium of $1.50 (for example). The put seller or writer who earns the premium of $1.50 assumes the risk of buying A from the investor if it falls below $25. Towards the end of the three-month period, if stock A is trading at $22, the investor will sell stock A to the put writer, and receive $25 for each share of stock A.

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'Put To Seller'

  • Introduction To Put Writing

    http://www.investopedia.com/articles/optioninvestor/02/030102.asp
    ... Thus, the put buyer now has the right to sell shares to the put seller. ... Note that
    in either scenario, the put seller realizes a loss of $200 at expiry. ...

  • When does one sell a put option, and when does one sell a call ...

    http://www.investopedia.com/ask/answers/06/sellingoptions.asp
    ... The purchaser of a put option pays a premium to the writer (seller) for the right
    to sell the shares at an agreed upon price in the event that the price heads ...

  • Short selling vs. purchasing a put option: how do the payoffs ...

    http://www.investopedia.com/ask/answers/05/shortvsput.asp
    ... to buy the asset at the market price, which is currently higher than where the short
    seller initially sold. In contrast, the purchase of a put option allows an ...

  • 4 Reasons To Hold Onto An Option

    http://www.investopedia.com/articles/optioninvestor/09/when-exercise-options.asp
    ... The obligation of a put seller is to purchase 100 shares at the strike price, but
    only if the option owner exercises before the option expires. ...

  • Finding Spin In The Financial Services Industry

    http://www.investopedia.com/articles/pf/10/identifying-spin-financial-services-industry.asp
    ... This is a hair-brained scheme that could work, so let's rather put your money into ...
    Once the dud investment has gone wrong, the seller is likely to try his luck ...

  • How To Sell Put Options To Benefit In Any Market

    http://www.investopedia.com/articles/optioninvestor/10/sell-puts-benefit-any-market.asp
    ... One benefit is the ability to generate income on your portfolio. If the sold put
    expires without exercise, the seller keeps the entire premium. ...

  • Is an earnings surprise priced into the opening value by market ...

    http://www.investopedia.com/ask/answers/06/earningssurprise.asp
    ... the buyer/seller response drive the price? An earnings surprise is an event where
    the earnings of a company are greater or lower than the predictions put forth ...

  • Getting Acquainted With Options Trading

    http://www.investopedia.com/articles/optioninvestor/03/073003.asp
    ... It is important to remember that there are always two sides for every option
    transaction: a buyer and a seller. So, for every call or put option purchased ...

  • Options Greeks: Gamma Risk and Reward | Investopedia

    http://www.investopedia.com/university/option-greeks/greeks5.asp
    ... In terms of position Gamma, a seller of put options would face a negative Gamma
    (all selling strategies have negative Gammas) and buyer of puts would acquire a ...

  • Bear Put Spreads: A Roaring Alternative To Short Selling

    http://www.investopedia.com/articles/optioninvestor/09/bear-vertical-put-spread.asp
    ... To purchase a put option, the investor pays a premium to the option seller.
    This is the entire amount of risk associated with this trade. ...

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