hi,
I am new to stock option trading. my question is when ppl say you can hedge of buying a stock and buying a put option( so if stock price go down you can recover the loss by price gain in put option ) or vice versa. . but stock prices and option premium dont move $ to $. .
say for example, If I buy Microsoft @ $20 , and buy $20- $25 put option. . if prices of stock went down to $18 , put option wont gain $2 . . so how do you protect yourself ? is there any ratio, like, for every 100 shares, you buy 2 contract(200 shares) put option or anything like that. . plz let me know

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