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Payoffs for Put Options: CNBC Explains

Sunday, 29 May 2011 | 12:00 AM ET

For many sophisticated investors, trading options is a routine practice that can be hugely profitable, but retail investors can also transact options contracts on the open market. It's a strategy with potential to enhance investors' portfolios and help them better navigate the market. Want to succeed at trading options? You need to understand exactly how these contracts work. Salman Khan of the Khan Academy explains how put options pay out.