Suppose you own a stock with current spot price at 100

The protection that we are seeking is the protection from the fall in the price of the stock. Such protection is completely provided by using a Protective Put strategy. This strategy will gaurd against the decline in price.

In this startegy, investor will go long on Put option on the same stock. This will cost premium to the investor. Either investor can buy At-The-Money (ATM) put option or buy slightly Out-The-Money (OTM) put option. Slightly OTM will cost less than ATM but investor has to bear little loss as this OTM option's Strike price, say 95, will be less than Current Stock price of 100; the difference of 5 will be suffered by the investor in case price fall from 100.

Going Long to Put option gives you protection from fall in price as Long position holder will exercise the option only in case when spot price fall from the strike price at the time of expiration. Long put postion gives investor the right to sell, not obligation to sell.