The investment team can also purchase put options. What are the potential benefits of this?
A. Recall, as discussed above, a put option gives the purchaser the right to sell a security to the writer at a pre-determined price. Put options rise in value as the underlying stocks or indices decline in value. By selling a put option, the team seeks to offset some of the risk of a potential decline in a portfolio holding.
Related Questions
- What are privately managed accounts. How do they differ from other investment options and what are the primary benefits to the investor?
- The investment team can also purchase put options. What are the potential benefits of this?
- Can The Team Real Estate Group help me locate and purchase investment property?