Downside protection

Downside Protection
Downside protection is a cushion against the potential loss resulting from a price decline in a security or market.

Downside Protection
Downside Protection definition :
Generally used in connection with covered call writing, this is the cushion against loss, in case of a price decline by the underlying security, that is afforded by the written call option.

DOWNSIDE PROTECTION - Generally used in connection with covered call writing, this is the cushion again...
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Downside Protection
A hedge constructed to limit the adverse impact on the value of an investment of a negative movement in market or security prices.

Finally, we need to understand how much downside protection the 10% buffer really provided considering how much of the upside was surrendered. Looking back at the period between October 1988 and September 2009, the buffer would have saved you only 6.

You sell the 30-60 day covered call taking in the premium money and giving you that amount of money downside protection to offset any move against you. The ideal trade will play out like this.

High-coupon bonds that sell at only at a moderate premium because they are callable at a price below that at which a comparable noncallable bond would sell. Cushion bonds offer considerable downside protection in a falling market.
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A negative change in ratings for a stock, or other rated security.
Downside Protection ...

The estimation of intrinsic value is subject to a lot of subjective judgments, so value investors have borrowed a term from engineering, the margin of safety, to make sure their portfolios have sufficient downside protection.

We go over the ground rules and available resources needed for this undertaking. Wading Into The Currency Market
These diverse asset classes provide both downside protection and upside potential. Commodities: The Portfolio Hedge ...

downside protection A position that limits the potential loss that would result from a decline in... downside risk The likelihood that a security or other investment will decline in price, or...

Cushion bonds offer considerable downside protection in a falling market. Cushion theory The theory that a stock with many short positions taken in it will rise, because these positions must be covered by the stock.

Cushion bonds offer considerable downside protection in a falling market. Custodial fees Fees charged by an institution that holds securities in safekeeping for an investor.

See also: Cushion, Convertible Bond, Convertible bonds, Collateral trust bonds, Revenue bond