The absolute basics
Day trading in plain English. What it is, what an options contract is, how calls and puts work, the four things that matter about every option, and a self-check quiz at the end. Nothing you don't need.
What is day trading?
Day trading means buying and selling the same thing within the same market day. Nothing held overnight. Small profits, stacked over dozens of small trades — never a swing-for-the-fences bet.
Day trading In & out
Hold minutes to hours. Close before the bell. Care about the tape right now — chart patterns, volume, momentum.
Investing Hold
Hold months to decades. Care about the company or the economy — earnings growth, cash flow, macro trends.
What is an options contract?
An options contract is a deal. It gives you the right — not the obligation — to buy or sell 100 shares of a stock at a set price, before a set date. That's it.
One contract = 100 shares, always. So the sticker price on an option is per share. A $2.15 quote actually costs $215 to buy one contract.
$2.15/share premium, that costs $215.Calls vs puts
Two flavors of options. Pick a side.
The four things that matter
Every options quote tells you these four numbers.
Strike
The price at which the option lets you buy (call) or sell (put) the stock.
Expiration
The last day the option is alive. After that, it's gone. 0DTE = expires today.
Premium
What one share of the contract costs. Multiply by 100 for the real cost of one contract.
Contracts
How many you buy. Each one controls 100 shares. Two contracts = 200 shares of exposure.
How money moves in and out
You make money when… Green
Calls: stock goes up. Puts: stock goes down. Speed matters — options lose value every minute (that's theta), so you want to be right and be right fast.
You lose money when… Red
Wrong direction, wrong speed, or wrong stock. Worst case: your option expires worthless and you lose the premium you paid. That's your max loss, no more.
The rule that keeps you eating: your risk is capped at the premium you paid. Never bet more than you can lose entirely.
Key terms — tap a chip
Vocabulary you'll hear every day. Short + honest definitions.
Quick check
Five questions. Instant feedback. No sign-up. Just to make sure it stuck.
Where to go from here
You've got the vocabulary. Time to see what to do with it.