---
title: "Protective Put — options strategy"
type: "options-strategy"
topic: "Options strategies (Indian markets)"
category: "Hedging"
outlook: "Bullish"
complexity: "basic"
risk: "defined"
slug: "protective-put"
url: "https://learn-derivatives.tapetide.com/strategies/protective-put"
markdown_url: "https://learn-derivatives.tapetide.com/strategies/protective-put.md"
source: "DeltaDesk by Tapetide"
---

# Protective Put

> **In plain English:** Insurance for a position you own. You pay a small premium for a put that pays out if the price crashes — like paying for car insurance so a big accident does not wipe you out. You keep all the upside, minus the insurance cost.

**Category:** Hedging · **Market view:** Bullish · **Complexity:** basic · **Risk:** Defined

## Structure

- Buy underlying (futures)
- Buy ATM-2 strikes put

## Summary

Own the underlying and buy a put as insurance against a fall.

## When to use it

You are long and want a defined downside before an event (results, budget) without selling your position.

## Profit & loss

- **Max profit:** Unlimited on the upside (minus the put premium paid).
- **Max loss:** Limited to (entry − put strike) + premium paid.

## Net Greeks profile

Positive delta, long vega (the put gains if vol spikes), negative theta.

## Margin

Margin-intensive (you sell options).

## Common mistakes

- Buying puts only after a fall has begun (expensive IV).
- Over-insuring and bleeding theta every day.

## India example

Long NIFTY future + buy a 2% OTM put into the RBI policy day.

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**Build it live in the [DeltaDesk Strategy Lab](https://learn-derivatives.tapetide.com/tools/strategy-lab)** — tune strikes and see payoff + net Greeks update instantly.

*Educational content only — nothing here is investment advice. Derivatives carry significant risk of loss. Tapetide is not a SEBI-registered research analyst or investment adviser.*