Married Put

A married put is a sophisticated portfolio protection strategy that involves simultaneously purchasing stock and put options as a unified position, creating synthetic call exposure with defined risk characteristics and unlimited upside potential. This advanced risk management technique differs from a protective put by establishing the stock and put positions simultaneously rather than adding protection to existing holdings, making it ideal for investors entering new positions with built-in downside protection. The strategy is particularly effective when investors want to participate in potential upside moves while maintaining strict risk control from the outset, essentially creating a call-like payoff structure with stock ownership benefits such as dividends and voting rights. Professional traders use married puts when they have bullish conviction but want to limit downside exposure, making it suitable for volatile stocks or uncertain market conditions where protection is essential. The strategy provides psychological comfort by establishing maximum loss parameters upfront, enabling investors to hold positions through market turbulence without emotional decision-making. The at-the-money put selection provides full downside protection but requires higher premium investment compared to out-of-the-money alternatives

If NIFTY is at ₹25,800, set up: Simultaneously buy NIFTY at ₹25,800 and buy ₹25,800 Put for ₹110, creating total investment of ₹25,910 with complete protection against losses below ₹25,800, limiting maximum loss to ₹110 while maintaining unlimited upside potential above ₹25,910.