Cash-or-Nothing Put

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Cash-or-Nothing Put

A put option that results in either a predetermined payoff, if the underlying asset trades below the strike price at the close of the expiration date, or no payoff, if it trades above the strike price. For example, suppose one holds a cash-or-nothing put to sell a certain amount of shares of Google at $400 per share. If Google is trading below $400 on the expiration date, the holder automatically receives the set payoff. If it is trading above $400, the payoff is zero. See also: Cash-or-nothing call.