Long Put

Long put: buyers of put options hope the stock to go down before expiration. It causes the puts to increase in price and therefore it makes it possible to make a profit when the option is exercised.

The puts are also used to hedge a stock position. Long puts establish limited risk and substantial reward. The loss is limited to the option premium the buyer paid for its purchase. The break-even point of this kind of option strategy is equal to strike price minus premium paid. The lower the spot price of the asset, the more profit the buyer can make in this case. Long puts are used when the buyers are bearish on the market.

Put long

If someone decides to buy the put option for the price of $20 when the strike is $100, break-even point will be $80, so the buyer will have this contract in-the-money if he exercises it at a price say $79, $70 and so on up to the asset downward movement end and he will suffer losses if this option is expired at a price higher this mark.