Long Put – When Downside Momentum Matters More Than Time

Long Put – When the Bears Take Control Quickly (Illustrative Example:

| April 2022 | Historical Price Reference: ₹100) Market View Bearish. This strategy is used when you expect a sharp and fast downward move in the stock before expiry. In this illustrative case, SAIL was trading near ₹100 in April 2022, and the expectation was for a decisive breakdown below the prevailing support zone. The Trade (Illustrative | Hypothetical Premium) • Buy SAIL 95 Put @ ₹4 (Premium is illustrative and used only for explaining the concept.) Breakeven • 95 − 4 = ₹91 Max Profit • Unlimited • Increases as SAIL moves further below the breakeven level Max Loss • Limited to premium paid (₹4) • Occurs if SAIL expires above 95 Premium & Margin • Premium: Paid upfront • Margin: Not required Effect of Time & Volatility • Time decay works against the position if price does not fall quickly • Rising implied volatility supports put option value Quick Logic Check (Important) • Risk is predefined and capped • Requires speed, momentum, and follow-through on the downside • Direction alone is not enough—timing is critical