You buy one $95 strike put option for a $3 premium. Cost: Total cost is $300 ($3 premium × 100 shares).
To profit, the stock must fall below the strike price by more than the premium you paid. What Are Put Options and How Do They Work? - IG UK what is buy put option
The set price at which you can sell the stock, regardless of its current market value. You buy one $95 strike put option for a $3 premium
Buying a put option is a powerful bearish strategy used by investors to profit from a stock's decline or to "insure" their existing portfolio. Unlike buying a stock where you want the price to go up, buying a put option increases in value as the underlying asset’s price drops. What is a Put Option? What Are Put Options and How Do They Work
The stock drops to $90. You can now sell the stock at the $95 strike price. Your profit is the $5 difference ($95 - $90) minus the $3 premium paid, totaling $2 per share ($200) .
The stock stays at $100 or rises. You choose not to exercise the option, and your loss is capped at the $300 premium . The Break-Even Point