Guide to trading CME Micro Futures contracts.
Micro S&P500 : MES
Micro NASDAQ: MNQ
Micro RUSSELL 2000: M2K
Micro DOW JONES: MYM
- the ‘big contract’ (introduced in 1982) with the ticker symbol SP which is priced at $250, multiplied for the market value of the future contract, let say for simplicity 4.000 (as of today is closer to 4220 though) = $1.000.000. Just a bit pricey!
- and the e-mini contract (introduced in 1997) offered with the ticker symbol of ES, priced at 1/5 of the original contract therefore $50; the market value obviously remains the same, since that is what’s based upon, hence $50 * 4.000 = $200.000. A bit better!
- since May 2019 CME is offering also the Micro e-mini contract, with the ticker symbol of MES, priced at 1/10th of the e-mini, therefore $5 and a contract value of $20.000. Now that’s affordable!!!
How to trade e-Mini contracts?
Keep in mind that no trader is expected to cash out over half a mil $ to trade 1 contract of course, instead traders are only required to front a fraction of the contract value to take a position called the margin.
The margin for the Mini ES for example is set by CME as of today at 11,000$.
I help you here in calculating how many contracts you can trade with the account provided by the Funder!
2 contracts of Mini ES = 2 * 11,000 = $ 22,000
total = $22.000,below the max allowed by my account.
How to trade Micro Futures?
The margin for Micros is 1/10 of the e-mini ES, so:
$11.000 / 10 = $1.100, affordable right?!
This opens up the world of Futures to the traders who until now focused solely on Forex exactly because of its affordability.
“Futures trading has been growing in popularity for active traders all over the world,” said Tim McCourt, CME Group Global Head of Equity Index and Alternative Investment Products. “The smaller contract size of Micro E-mini equity index futures will make it easier to more nimbly execute a variety of equity trading strategies, while benefiting from the deep liquidity that CME Group markets offer around the clock.”
“More active traders are participating in the futures market than ever before. In 2018, CME Group’s non-institutional trading business grew 27 percent compared to the previous year, with active traders averaging 660,000 contracts each day. Globally, active trader participation in CME Group markets grew 30 percent in Asia and 36 percent in Europe last year.”
E-mini ES 1 point is worth $50, and with 0.25 ticks increment, each tick : $50/4=$12,50
Micro MES is worth $5, still at 0.25 ticks increment, each tick : $5/4=$1,25
E-mini NQ 1 point is worth $20, and with 0.25 ticks increment, each tick : $20/4=$ 5,00
Micro MNQ is worth $2, still at 0.25 ticks increment, each tick: $2/4=$ 0,50
E-mini RTY 1 point is worth $50, and with 0.10 ticks increment, each tick: $50/10=$ 5,00
Micro M2K is worth $5, still at 0.10 ticks increment, each tick: $5/10=$ 0,50
E-mini YM 1 point is worth $ 5, and with 1 tick increment, each tick = $ 5,00
Micro MYM is worth $ 0,50, still at 1 ticks increment, each tick = $ 0,50
This becomes much easier to manage for the trader with a smaller capital.