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The investor may be utilizing the puts to protect an existing position in the underlying shares.
The trader could be getting long the puts to protect the value of a long position in Live Nation shares.
Even though using puts to protect a covered write limits losses, it's important to remember that the overall return will be lower due to the cost of the put and added commissions involved.
In addition, an article in a well known financial publication stated over the weekend that derivatives strategists are recommending that investors buy defensive puts to protect themselves from a moderate correction in stocks, as investors react negatively to the expected deceleration in corporate-earnings growth.
The investor is most likely utilizing the puts to protect the value of an underlying stock position, and if this is the case, is insured against losses to the downside should JPMorgans shares decline beneath the effective breakeven price of $36.25 in the next year to expiration.
Similar(55)
Most of Bangkok, however, has remained dry and most of its more than 9 million residents were staying put to protect their homes.
Under these conditions people will be hard put to protect themselves from cholera, diarrhoea and other deadly diseases".
An accumulation of this protein in the cell wall could be part of the complex set of defenses that are put in place to protect the developing seed.
Preventive measures are being put in place to protect the 'vulnerable', says Neasa MacErlean.
The high bar was put in place to protect workers from losing earlier gains.
A ban on shorting was put in place to protect financial stocks.
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