Naked Put
Categories: Derivatives
See: Naked Call, and multiply everything by negative 1. Or rather, simply note that a naked put, if you're buying one, is just taking an on-off speculative roll of the dice that a given stock is gonna go down.
Say MSFT is at $60 and you think its new product rollout will blow up bad. So you buy a $55 strike put that expires in four months for a buck. The trade either works out via MSFT going to $54 or worse...or it doesn't. You're naked on that one bet.
And this is a Thing, because most professional traders don't go naked all that much. Most trades are paired with others, as they try to find little arbitrage opportunities in the market along the bumpy road of life.