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American Put Option

An American put option is a contract that gives the buyer the right to sell 100 shares of an underlying stock at a predetermined price (the strike price) for a specific time period defined by the expiration date. The seller of a Put option is obligated to buy the underlying security if the Put buyer exercises his or her right to sell on or before the option expiration date. For example, 1 contract of the XYZ May 21 60 Puts entitles the buyer to sell 100 shares of XYZ common stock at $60 per share at any time prior to the option's expiration date of May 21st.

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