First — what even is an option?
A stock share is a piece of a company. An option is a short-term contract that lets you profit from a stock's move without buying the shares. One contract controls 100 shares, but costs a small fraction of what 100 shares would. That leverage is why a small move in the stock can double a cheap option — and why it can also go to zero. TRADINGHOOD only ever buys options (never sells/writes them), so the most you can lose on a trade is what you paid.
The one thing to burn into memory: CALL vs PUT
▲ CALL
You buy a CALL when you think the stock is going UP. The call gains value as the stock rises. On the board, a green CALL signal = TRADINGHOOD sees an up-move setting up.
▼ PUT
You buy a PUT when you think the stock is going DOWN. The put gains value as the stock falls. A red PUT signal = a down-move setting up. (You are NOT short-selling — you're just buying a contract.)
"Buy to open" vs "Sell to close" — the buttons on Robinhood
Every TRADINGHOOD trade is a two-step round trip you do yourself in the Robinhood app:
BUY TO OPEN — you enter by buying the call or put
→
the move plays out
→
SELL TO CLOSE — you exit by selling it back
You do Buy to Open whether it's a call or a put — "put" already means you're betting down, so you still buy the put. "Sell to Close" is just cashing out the contract you hold. TRADINGHOOD never presses these buttons — it hands you the plan, you tap.
The words you'll see on every signal
Premium / cost
The price of the contract. Multiply by 100 to get the dollars you pay — and that is your maximum loss. A $2.00 option = $200 per contract at risk.
Strike
The price line the option is built around. TRADINGHOOD picks strikes near the current price so the option reacts quickly.
Expiration
The contract's deadline. We use the nearest expiration for fast in-and-out scalps.
Delta
How much the option moves for a $1 move in the stock, and a rough chance of finishing profitable. 0.50 ≈ moves ~50¢ per $1, ~50/50 odds.
Theta (decay)
Options bleed a little value every day as expiration nears. This is why we exit fast — holding a scalp overnight lets theta eat you.
IV
Implied Volatility — how much movement the market has priced in. High IV = pricier options and bigger expected swings.
Spread
The gap between the buy and sell price. Tight (green ✓) is cheap to get in/out of; wide eats your profit before you start.
How TRADINGHOOD actually trades (our strategy, in one breath)
It watches a handful of liquid stocks across four timeframes — 15-minute for the big picture, 5-minute for direction, 1-minute for the setup, 15-second for the trigger. It only fires a signal when they line up. Then it hands you a complete plan:
Bullish lineup → buy a CALL
Bearish lineup → buy a PUT
For each signal you get an entry, a stop (the price that proves it wrong — where you cut the loss), and targets (where you take profit), plus three ready-to-trade contracts: Aggressive (cheapest, fastest, decays fastest), Balanced, and Conservative (pricier, steadier). Aim for Target 1 and get out — this is a scalp, not a hold.
The safety cage (what keeps a bad day from becoming a bad month)
Risk a small, fixed slice of your account per trade — never bet the farm on one idea. Every entry is paired with a stop. Never average down a loser (don't buy more of a trade that's going against you). And only ever use money you've set aside for this that you could afford to lose entirely. TRADINGHOOD shows you whether a contract fits your buying power, but the discipline is yours.
◷ TRADINGHOOD is a signal tool, not an adviser. It never places, changes, or cancels an order and never moves money. Every trade is your decision and your click. This is education, not investment advice.