There are four ways to trade options: buying a call, buying a put, selling a covered call, or selling a cash-secured put. Each one serves a different purpose, but the process to place them is the same.

Buying gives you a right: to buy (call) or sell (put) the stock at the strike, by paying a premium. Selling commits you to something: delivering your shares (covered call) or buying them (cash-secured put) if you're assigned, in exchange for collecting a premium. To sell, you need the corresponding backing, either the shares or the cash.

Step by step

1. Go to the stock you want to trade and tap Trade.
2. In the menu that opens, tap Trade options.
3. In the contract list, choose the expiration date.
4. Select Buy or Sell, and Call or Put, in the selectors.
5. Choose the strike you prefer, and review the contract's details: premium, breakeven, and the probability of finishing in the money (meaning the contract would already have value if you exercised it today).
6. Tap the Buy call or Sell put button, depending on your choice.
7. Set your limit price using the Bid and Ask as a reference, enter the number of contracts, and tap the button to continue.
8. Review the order summary. If you're selling, confirm you have the necessary backing: 100 shares per contract for a call, or enough cash for a put. Tap Confirm order.
9. You'll see a confirmation screen showing your order was received.

Your order stays pending until the price reaches your limit or until market close the same day. You'll get a notification when it fills.