You should try to find the signal rules for railroads. IIRC, there are published (probably on-line) rules for the Santa Fe and the Canadian railroads, both for older eras and more modern (1990's).
The railroads generally followed a format where the red signal is on the bottom or lower signal, with the green on top. If there is a yellow aspect, it is generally in the middle. In case you've never noticed, this is the opposite of automobile traffic lights, where the red is on the top! Don't know why that is, but perhaps so the red is closer to the train crew, since a lot of railroad signals are placed higher (on a signal bridge or just on a tall pole to the side of the track). Also, railroad signals can include multiple colors lighted at the same time, which indicate different situations. For example, plain red usually does mean "STOP". But it may also mean, "Stop, then proceed with caution to the next signal. If the next signal is also red, then the "stop" is absolute. But a green over red may, depending on the rule may mean "Slow, proceed at a speed no greater than ____ and be prepared to stop.
Interlocking signals can be really interesting. A yellow over red may mean proceed through the turnout at a speed not to exceed (say, 15 mph) on the diverging route. On my layout, signals are mainly used by me to indicate which way are clear for a train to run. If the turnout is against an oncoming train, then I have a red light only. If the train is okay to enter a turnout that might be against it otherwise, then the light will show green. If the train has a choice of two diverging routes, I may have a three-light signal, with the lights in a triangle. The lower light will either be off or red, and the side-by-side upper lamps will be green (or amber...depending on what is the most important route), and which lamp is lighted depends on the direction the train will take. If the signal is located across the room, so I can't tell which of the directionals is lit, I may use an amber light for one direction and green for the other, with the bottom red lighted all the time. I generally wire my signals directly to the track, with the turnout throw determining the lamp that is lit. When operating on DC, the lamps will change brightness according to the throttle setting. When I'm using DCC, the lamps will be at full brightness. Therefore, I use 14-16 volt incandescent lamps. LED's will also work, IF you have the proper resistors in series, but the LED's are subject to the polarity of the track. In some instances, where my turnouts don't have directional points (Atlas), I will use the Atlas Snap Relays, which are essentially "latching" DPDT switches, and can be wired to be actuated by the same power that throws the Atlas switch machines.
Green boards all the way!