Long Put

What you must believe

NIFTY falls meaningfully, and soon. The same deadline discipline as the long call, pointed down. Falls are faster than rallies when they come, which is exactly why the market charges more IV for the put side (skew).

Construction

Buy the weekly 25,000 PE at ₹110. One lot costs ₹7,150, the full and final risk.

The numbers, before entry

• Max loss: ₹7,150, anywhere above 25,000 at expiry
• Max profit: large; grows all the way to a market of zero
• Breakeven: 24,890 (strike − premium)
• Margin: none beyond the premium

Greeks profile

Delta −0.50 at entry, long gamma, short theta, long vega. Crashes spike IV, so a well-timed long put wins twice: on direction and on the fear repricing.

Realistic expectations

Same arithmetic as the long call: frequent small losses, occasional large wins. Puts carry an extra honest cost: their IV is structurally richer than the call side, so you pay the skew for the privilege of betting down.

Management rules

• Same three exits written before entry: target, loss level, time stop
• Crash days are exit days: IV spikes fade fast, and the put's best price usually appears during the panic, not after it
• Do not hold "for the bounce back down"; expiry does not wait

With other strategies

• Held against a portfolio, it is the protective put: same instrument, insurance job (Lesson 8)
• Sell a lower put against it and it becomes a bear put spread: the skew you paid gets partly sold back
• Add the matching call for a straddle into binary events, when the direction is the only thing you do not know
• Its mirror is someone's cash-secured put: understanding the seller across the table (Lesson 21) is the fastest way to judge whether your price is fair

Common mistakes

• Buying puts after the fall, at peak IV, for the rebound-lower that never prices well
• Using far OTM puts as "cheap" crash bets and repurchasing them weekly forever
• Confusing a hedge (Lesson 8) with a bet; they are sized and judged differently