 Upput option contract is just an opposite to the call contract. In a call contract, the owner has a right to buy an underlying asset at a fixed price during a particular period of time, whereas under a put option contract, the holder has a right to sell the underlying asset at an exercise price at the expiry date of the put option contract. The circumstances that determine the value of a put option contract are just opposite to the circumstances that determine the value of a call option contract. Now let's see we have an exercise price of a put at $50 per share and a stock price at the expiration date is estimated at $40 each. Now buying the stock at an exercise price of $40 and immediately selling it at the stock price of $50 will yield a $10 profit for the holder of the put contract. This means that as much as lower side of stock price will yield a profit for the holder of the put contract and if the stock price is greater than the exercise price then there is no value of put for the option holder and he will try to let the expiry date go on and if we compare the payoffs under a put transaction then we will see that if the stock price is less than the exercise price then there will be a profit for the put holder and if the stock price is greater than the exercise price there will be no payoff as the holder of the put will not exercise his right to sell the asset rather he will prefer to let the expiry date go. Further we have another example where a buyer holds a one-year put to sell a share of BMA stock at $150 and he believes that the stock price will fall from the current price of $160. On the expiration date if the stock price is $200 then the put option holder will not sell the stock of $200 for a price of $150 but if the stock price is $100 at the expiration date then the put holder will certainly exercise his right to sell the particular stock which means that the buying stock at a stock price of $100 and immediately selling it at an exercise price of $150 which yield a $50 profit for this put holder contract. So we can say that the value of a put option on the expiration date in this contract will be equal to $50 which is the difference between exercise price of $150 and the stock price of $100 and in this case we can say that a put is valuable for the holder only if the stock price is less than the exercise price on the date of expiry of the put contract.