What is a put option, in plain words?
A put option is a contract that gives you the right, but not the duty, to sell 100 shares of a stock at a set price (the strike) until a set date (the expiry). It works like insurance against a fall: if the stock ends below the strike, the put is worth the difference; if it ends at or above, it expires worth nothing and you lose what you paid for it, and no more.
Try it: a put with a $50 strike, bought with 30 days left at 30% implied volatility (made-up numbers). Move where the stock ends at expiry.
Simulated example, priced by the StrikePath engine (Black–Scholes, interest 4.3% a year). For learning; not advice.
Two reasons to buy a put
To protect shares you own: if they fall below the strike, the put's gain offsets part of the loss, like an insurance payout. Or to take part in a fall without selling shares short, with a loss limited to what you paid.
Insurance has a premium
The put's price is the premium. It is higher when the market expects big swings (high implied volatility) and when more time is left. Like insurance, it can expire unused, and then its cost was the price of the protection.
What this shows, and what it doesn't
The value at expiry for one contract, before fees and the bid-ask spread. Selling (writing) a put is a different trade: you collect the premium and may have to buy 100 shares at the strike, however far the stock has fallen.