How to Buy Options on Robinhood 2026: A Simple Guide

Options trading can look complicated at first, but platforms such as Robinhood have made the process easier to navigate.

Still, an easy to use app does not make options themselves simple or low risk. An option is a contract whose value is based on an underlying asset such as a stock, ETF, or index.

Depending on the strategy, traders can use options to speculate on price movements or manage portfolio risk.

Robinhood currently requires users to apply for options trading access, and approval depends partly on the investor profile.

This guide explains how to buy options on Robinhood, what beginners need, whether $100 is enough, and what to understand before placing an order.

Key Takeaways

• Robinhood requires approval for options trading, with access and strategy levels based partly on your investor profile.

• You can buy options through the Robinhood app by selecting an eligible stock, ETF, or index and choosing Trade, then Trade options.

• $100 can be enough to buy some contracts, but options can lose most or all of their value quickly.

What Are Options and How Do They Work?

Before learning how to purchase options in Robinhood, it helps to understand what you are actually buying.

An option is a contract between a buyer and a seller that derives its value from an underlying security. Robinhood supports options on stocks, ETFs, and indices.

There are two basic types of options:

Call Options

A call option gives the buyer the right, but not the obligation, to buy the underlying asset at a specified strike price before or at expiration, depending on the contract terms.

Traders generally buy calls when they expect the underlying asset to increase in value.

Put Options

A put option gives the buyer the right, but not the obligation, to sell the underlying asset at a specified strike price.

Traders generally buy puts when they expect the underlying asset to decline.

The price paid for an option is called the premium. Other important details include the strike price and expiration date.

For example, suppose a call option has a $100 strike price and costs $2 per share.

Since standard equity options generally represent 100 shares, one contract would have a premium of $200 before applicable fees.

The underlying stock must move enough for the trade to overcome that initial cost and other factors affecting the contract.

Time is particularly important. As expiration approaches, an option can lose value even when the underlying asset does not move much. Volatility also affects option prices.

This is why beginners should not choose an option simply because the premium looks cheap.

A low premium may reflect a distant strike price, a short expiration period, low probability of profitability, or other market factors.

Robinhood itself warns that options are complex and can result in losing the entire initial investment, while some strategies can create losses beyond the original amount invested.

Read Also: 7 New Tokenized Stocks on the Robinhood Chain with High Gains

How to Buy Options on Robinhood

The actual process of placing an options order is relatively straightforward, but you need to qualify for options trading first.

Robinhood currently instructs eligible users to open their account settings, go to Investing, select Options trading, and follow the application prompts.

The platform then determines the options trading level for which the user is approved.

Step 1: Open and Fund Your Robinhood Account

First, create a Robinhood brokerage account and provide the personal and financial information requested during the application process.

You will generally need information such as:

• Your legal name

• Address

• Tax identification information

• Employment information

• Financial information

• Investing experience

Once your account is approved, you can add funds through an available funding method.

Step 2: Apply for Options Trading

Options trading is not automatically available to every Robinhood customer.

Within the account:

• Open Investing.

• Find Options trading.

• Select Get options trading.

• Review your investor profile.

• Complete the required options agreement.

• Wait for Robinhood to determine your approved level.

Robinhood currently identifies Level 2 and Level 3 options access. Level 2 supports basic strategies such as long calls, long puts, and covered calls, while Level 3 provides access to certain more advanced strategies. Cash accounts do not support Level 3 options trading.

Step 3: Find an Options Contract

Once approved, search for the stock, ETF, or index you want to trade.

Robinhood’s current instructions are:

• Search for the underlying asset.

• Select the asset.

• Select Trade.

• Select Trade options.

You can then review available expiration dates and strike prices.

Step 4: Review the Contract

Before submitting an order, check:

• Call or put

• Strike price

• Expiration date

• Premium

• Bid price

• Ask price

• Break even point

• Potential maximum loss

Robinhood also displays a chance of profit percentage, but the company emphasizes that this is an estimate based on model assumptions and is not a guarantee of future results.

Step 5: Submit the Order

After selecting your contract and quantity, choose an appropriate order type and review the details before submitting.

A limit order lets you specify the maximum price you are willing to pay for an option. This can give you more control over the purchase price, although the order is not guaranteed to execute.

If you are also interested in cryptocurrency markets alongside traditional investments, Bitrue provides a separate platform for buying, selling, and trading digital assets.

You can register with Bitrue to explore its crypto markets while keeping your options activity separate from your cryptocurrency trading.

Can I Trade Options With $100?

Yes, you may be able to trade options with $100, but that does not mean $100 is enough for every options strategy.

Option premiums vary significantly. Some contracts cost less than $100, while others cost hundreds or thousands of dollars.

The amount required depends on the specific underlying asset, strike price, expiration date, volatility, and market conditions.

What Can You Do With $100?

With a $100 account, you may find individual contracts priced below $1 per share.

Because a standard equity option contract typically represents 100 shares, a quoted premium of $0.50 would correspond to approximately $50 before applicable fees.

However, buying a cheap option is not necessarily a good trade.

For example, an option costing $50 could potentially lose its entire value if it expires worthless. That means a trader with only $100 could lose half of the account on one contract.

For beginners, risk management is therefore more important than finding the cheapest contract.

Is Robinhood Good for Options?

Robinhood can be convenient for beginners because its options interface is designed to make contract selection and order placement accessible.

The platform also provides educational resources, an options strategy builder, and information such as break even points and potential profit and loss.

However, convenience has limits. Options require an understanding of probability, volatility, expiration, strike prices, premiums, and order execution.

Robinhood currently advertises no base fees, no exercise and assignment fees, and no per contract fees for stock and ETF options.

Other regulatory and trading related fees may still apply, and Robinhood lists a contract fee for index options.

Beginner Mistakes to Avoid

New traders should be especially careful about:

• Buying options only because they are inexpensive

• Ignoring the expiration date

• Choosing contracts with poor liquidity

• Using money needed for essential expenses

• Trading without understanding the maximum loss

• Using advanced strategies before understanding basic calls and puts

• Assuming a high chance of profit guarantees a winning trade

Options can move much faster than ordinary stock positions. A contract that looks attractive in the morning can lose substantial value later the same day.

For that reason, beginners should consider learning the basics before increasing their position size.

Starting small can make it easier to understand how option prices respond to changes in the underlying asset, time, and market volatility.

Read Also: Robinhood Enters UK Crypto: What Changes Next?

Conclusion

Learning how to buy options on Robinhood is relatively straightforward once your account has been approved for options trading.

You can search for an eligible stock, ETF, or index, choose Trade options, review the available contracts, select your strike price and expiration date, and submit an order.

The harder part is understanding whether a particular option makes sense for your strategy. Options can provide flexibility, but they also carry significant risks.

A contract can lose most or all of its value, particularly when the underlying asset does not move as expected before expiration.

A $100 account may be enough to purchase some options contracts, but it should not be viewed as a guaranteed path to large returns.

If you are also interested in cryptocurrency trading, Bitrue offers a convenient platform for buying and trading digital assets.

FAQ

How do I buy options on Robinhood?

After receiving options approval, search for an eligible stock, ETF, or index, select Trade, then Trade options. Choose the contract, review its strike price, expiration, premium, and other details, then submit your order.

How do I purchase options in Robinhood for beginners?

Start by learning how calls, puts, premiums, strike prices, and expiration dates work. Then apply for options access, choose a simple strategy, review the contract carefully, and consider starting with a small position.

Can I trade options with $100?

Yes, some options contracts can cost less than $100. However, the entire premium paid for an option can potentially be lost, so having $100 available does not mean you should risk all of it on one trade.

Is Robinhood good for options?

Robinhood offers a relatively accessible options interface, educational resources, and tools for reviewing contracts and strategies. However, whether it is suitable for you depends on your experience, strategy, costs, and preferred research tools.

What is the biggest risk when buying options?

One major risk is losing the entire premium paid for an option if the contract expires worthless. Certain strategies can carry substantially greater risks, including losses beyond the initial investment.

Disclaimer: The views expressed belong exclusively to the author and do not reflect the views of this platform. This platform and its affiliates disclaim any responsibility for the accuracy or suitability of the information provided. It is for informational purposes only and not intended as financial or investment advice.