Using Puts to Protect Long Positions

I have heard of people using puts to protect their long positions. However, I haven?t found any good information on how, or even if it is a good idea. I recently got burned by MNGA on an overnight position where they diluted in the premarket and by the time the market opened my shares were down almost a dollar.

I was fortunate that I wasn?t caught in the recent PLUG dilution, but I was going to take a position, but my entry price was missed otherwise I would have been caught.

That got me to thinking that if I had bought puts to go along with my long position that I might have at least limited my risk or maybe made a profit.

My questions are:

Is this a viable strategy?

Is it common for traders to do this?

Does anyone have any suggestions on how best to employ this strategy? 1:1 Long vs. Short or some other ratio? Would the rules of choosing the strike price be any different? I.e. choosing a strike price in the money or at the money?

Your wisdom is appreciated!

This is a strategy used by large holders. It is a "stop loss" as such as most funds do not monitor their positions all the time.

For a retail trader would cost you more money then what it is really worth. And if you seen the dilution happening. You do know you can trade pre-market as well also right?