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PUTAn option—a right that operates as a continuing proposal—given in exchange for consideration—something of value—permitting its holder to sell a particular stock or commodity at a fixed price for a stated quantity and within a limited time period. A put is purchased for a fee paid to the person who agrees to accept the stock or goods if they are offered. The purchaser of this right to sell expects the price of the stock or commodity to decrease so that he can deliver the stock or commodity at a profit. If the price rises, the option need not be exercised. The reverse transaction is a call. |
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