Stock Index Futures Tick Values

April 2, 2024 Advanced
Learn how index futures contracts use tick sizes and tick values to track how much positions gain or lose each day.

Like a baseball game scorecard, tick sizes are a fundamental scorekeeping mechanism for trading the markets. They help traders track how much prices go up or down on a given day, revealing how much money they made or lost.

For stocks, tick sizes are fairly straightforward. Basically, it's dollars and cents times the number of shares. But for stock index futures based on the S&P 500® index (SPX) and other benchmarks, it's a different sort of game.

What is a futures tick size?

Futures contracts have a minimum price fluctuation, also known as a tick. Tick sizes are among the contract specifications, a.k.a "specs," set by futures exchanges, such as the Chicago-based CME Group, and are designed to encourage efficient, liquid markets through "tight" bid/ask spreads. But futures tick sizes are not all the same. They vary depending on the type of contract, size of financial instrument, and requirements of the marketplace.

Why should a trader understand tick sizes and tick values in the futures market? As with stocks or other assets, it's critical to keep close tabs on how much an investment or position gains or loses over the course of an hour, a day, or other time periods. If you're not familiar with a contract's tick size, you may be at risk of putting on a position that's too large or too small. It might also be hard to measure your trading results. 

"You'll want to familiarize yourself with the minimum price fluctuation—the tick size—for whatever futures contracts you plan to trade," according to the National Futures Association (NFA) website. "You'll also need to know how a price change of any given amount will affect the value of the contract."

For example, CME Group's E-mini S&P 500 futures (/ES), which are one-fifth the size of the exchange's standard S&P 500 futures contract, are widely used by traders and other market professionals to speculate on the broader equity market or hedge against adverse movements in a portfolio of stocks.

E-mini S&P 500 futures (/ES) are the most actively traded U.S. equity index futures contract, with 1.81 million contracts changing hands on average each day during 2023, according to the CME Group's exchange data. Other CME Group e-mini futures include contracts based on the Nasdaq-100® Index (NDX), Dow Jones Industrial Average® ($DJI), and the Russell 2000® Index (RUT).

Index futures contract specs

Table lists index contracts, thinkorswim® ticker symbols, contract sizes, minimum fluctuation index points (tick), and the dollar value of one tick.

For educational purposes only. Not a recommendation.

Doing the math

Here's an example of how tick sizes are a different sort of animal versus stocks. Say a trader holds 100 shares of a stock trading at $10 per share, with a total position value of $1,000. In this case, an increase or decrease of $0.10 calculates out to $0.10 x 100, or a gain or loss of $10. Pretty simple math.

For /ES, the contract size is $50 times the index value. So, for example, if the SPX is at 5,100, the contract value is $255,000. The minimum tick is one-quarter of an index point, or $12.50 per contract.

If /ES rises or falls, say 30 points (about 1%), that translates into a gain or loss of $1,500 (30 points/0.25 minimum tick = 120 ticks; 120 x $12.50 = $1,500).

Tick sizes and values are also different for CME Group's Micro E-mini equity index futures, which the exchange launched in May 2019 and are one-tenth the size of CME Group's e-mini equity index futures contracts. 

For Micro E-mini S&P 500 futures (/MES), the minimum tick or price fluctuation is also 0.25 index point, or $1.25 per contract (one-tenth of the $12.50 per contract of the /ES). The value of one contract is calculated by multiplying the current level of the index by $5.  

So, if the index moves 30 points, or 1%, that translates into a gain or loss of $150 (30 points/0.25 minimum tick = 120 ticks; 120 x $1.25 = $150).

Other micro contracts include E-mini Nasdaq-100 futures, E-mini Dow futures, and E-mini Russell 2000 futures. If you're trading stock index futures, it can be confusing to track all the different contract and tick sizes. That's why it might help to keep a table handy with the contract specifications (like the one above).

Ready for more? Learn more about tick sizes and other basics of futures contracts.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision. 

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third-party providers is obtained from what are considered reliable sources. However, its accuracy, completeness, or reliability cannot be guaranteed. 

Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.

Charles Schwab Futures and Forex LLC is a CFTC-registered Futures Commission Merchant and NFA Forex Dealer Member. 

Charles Schwab Futures and Forex LLC (NFA Member) and Charles Schwab & Co., Inc. (Member SIPC) are separate but affiliated companies and subsidiaries of The Charles Schwab Corporation.

Investing involves risk, including loss of principal.

Futures and futures options trading involves substantial risk and is not suitable for all investors. Please read the Risk Disclosure Statement for Futures and Options prior to trading futures products. Futures accounts are not protected by the Securities Investor Protection Corporation (SIPC). 

Read additional CFTC and NFA futures and forex public disclosures for Charles Schwab Futures and Forex LLC. 

Futures and futures options trading services provided by Charles Schwab Futures and Forex LLC. Trading privileges subject to review and approval. Not all clients will qualify.