covered put

covered put
The sale of a put option while holding sufficient cash to buy the underlying. American Banker Glossary
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A put option position in which the option writer also is short the corresponding stock or has deposited, in a cash account, cash or cash equivalents equal to the exercise price of the option. This limits the option writer's risk because money or stock is already set aside. In the event that the holder of the put option decides to exercise the option, the writer's risk is more limited than it would be on an uncovered or naked put option. Bloomberg Financial Dictionary
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The sale of put options while long cash. LIFFE

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covered put UK US noun [C] (also covered put option)
FINANCE an agreement that allows you to sell shares, bonds, etc. which you own or have enough money in an account to buy, before a fixed date for a fixed price

Financial and business terms. 2012.

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