what is a protective put 
a protective put is a risk management strategy using options contracts that investors employ to guard against the loss of owning a stock or asset the hedging strategy involves an investor buying a put option for a fee called a premium puts by themselves are a bearish strategy where the trader believes the price of the asset will decline in the future however a protective put is typically used when an investor is still bullish on a stock but wishes to hedge against potential losses and uncertainty protective puts may be placed on stocks currencies commodities and indexes and give some protection to the downside a protective put acts as an insurance policy by providing downside protection in the event the price of the asset declines 