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The following diagram shows the profit to an option strategy called protective put. By looking at the profit diagram, you can infer that this protective

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The following diagram shows the profit to an option strategy called "protective put". By looking at the profit diagram, you can infer that this protective put" is Payoff and profit Payoff (C) Protective constructed by put Profit X ST X- (So+P) Buy a put option and the underlying stock Write a put option and the underlying stock Buy a call option with the underlying stock Write a call option with the underlying stock

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