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Before you buy put options, you need to know enough about the patterns of various stock to be able to predict whether it will go up or down. If you're buying put options, you are making a prediction that the stock will go down over time.  In addition to looking at the stock market itself, you also have to be able to analyze trends in various industries. Understand which sectors will tend to go up and which will tend to go down in response to various economic factors. If you don't have a lot of experience trading, you may want to watch the market for awhile before you start buying options. Take advantage of any educational resources and training offered by your broker to learn more about how options work. The strike price of your option is the price at which you agree to purchase the stock on the expiration date of the options. With put options you have the right to buy the stock at that price, but no obligation to do so.  To make money on put options, you want to set the strike price lower than the price for which the stock currently sells. For example, if a stock is currently selling at $100, but you believe it will decline to below $80, you might buy a put option to sell shares at $85. If the stock price drops below $85, you could sell those shares at a profit. Strike prices are standardized based on the price of the stock, and sold in option chains that have a range of strike prices at varying expiration dates. Options chains have a variety of short-term and long-term options available. Generally, the shorter the time period, the riskier the investment.  Longer time periods give you more options if the stock doesn't move the way you've predicted it would. If you're just starting out, you'll probably want to go with monthly or yearly expiration dates. You may be restricted to longer-term options depending on your trading level, especially if you're a new trader. Each contract represents 100 shares of stock. You'll have to pay a premium for each contract to the seller of the contract. Depending on how your broker fees and commissions are structured, you may also have to pay a per-contract fee to your broker. The number of contracts you buy depends on how much money you have available and how much you're willing to risk on the prediction you've made about the movement of that stock. You'll use your broker's trading platform to buy the options contracts you've decided you want. Call your broker's trading desk if you have any questions or need guidance. If your broker has a tutorial available, you may want to go through that first to make sure you're doing everything correctly.
Analyze stock movement. Choose your strike price. Select an option chain with the expiration date you want. Decide how many contracts you want to buy. Pay your premium and fees to buy your options contracts.