A customer purchases 100 shares of stock.

Purchasing a put option allows the customer to sell the stock at a predetermined price (the strike price) if the share price declines. This strategy protects against downside risk while maintaining upside potential.

C is correct because a put acts as insurance, locking in a minimum sale price.

A is incorrect because selling a put exposes the investor to additional risk if the stock declines.

B is incorrect because selling a call generates income but does not protect against downside risk.

D is incorrect because purchasing a call is a bullish strategy unrelated to protecting existing positions.