Post #12065 by Engr27 on the US Policy board

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You could sell a Jun 455 put for about $5.50 (which happens to be about the same price as the Jun 550 call you might sell). If the stock dives sometime between now and June 20th, you can choose to exercise and buy shares at 455 (minus the 5.50 premium for a net price of 449.50 or so).

By selling the put you have chosen to pay no less than 449.50 no matter how deep the dive. And you will pay more if you buy back the put prior to expiration. I assume that's what you mean by "exercise", because as the put seller you don't exercise anything.

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