The stock stays at $100 or rises. You choose not to exercise the option, and your loss is capped at the $300 premium . The Break-Even Point
The cost you pay to buy the option; this is also your maximum potential loss. what is buy put option
You buy one $95 strike put option for a $3 premium. Cost: Total cost is $300 ($3 premium × 100 shares). The stock stays at $100 or rises
To profit, the stock must fall below the strike price by more than the premium you paid. What Are Put Options and How Do They Work? - IG UK regardless of its current market value.
The set price at which you can sell the stock, regardless of its current market value.