Ticks, points, margin and leverage: the numbers behind every futures trade
Tick and point values for ES, MES, NQ, MNQ, crude and gold, contract value, the kinds of margin, how leverage works, and how to turn a prop firm max loss into points.
"MNQ moved 40 points" means $80 per contract to one trader and $800 to another. To know what a move means for you, you need four words: tick, point, margin and leverage. They're the numbers behind every futures trade, and once they click, sizing a trade stops being guesswork.
Ticks and points
A tick is the smallest amount a contract's price can move. A point is a move of 1.00 in the price. Each contract has a fixed dollar value for both, set by the exchange.
| Contract | Tick size | Tick value | Point value |
|---|---|---|---|
| ES (E-mini S&P 500) | 0.25 | $12.50 | $50 |
| MES (Micro E-mini S&P 500) | 0.25 | $1.25 | $5 |
| NQ (E-mini Nasdaq-100) | 0.25 | $5.00 | $20 |
| MNQ (Micro E-mini Nasdaq-100) | 0.25 | $0.50 | $2 |
| CL (Crude oil) | 0.01 | $10.00 | $1,000 |
| MCL (Micro crude oil) | 0.01 | $1.00 | $100 |
| GC (Gold) | 0.10 | $10.00 | $100 |
| MGC (Micro gold) | 0.10 | $1.00 | $10 |
Your profit or loss is simply: points moved × point value × number of contracts. A 12-point win on 3 MES is 12 × $5 × 3 = $180, before fees.
Always think in dollars, not points. 20 points on NQ is $400 per contract. 20 points on MNQ is $40.
Contract value (notional)
The contract value, or notional value, is how much market exposure one contract gives you: price × point value. With the S&P 500 near 6,800, one ES controls about 6,800 × $50 = $340,000 of the index. One MES controls about $34,000. You don't pay that amount. You just gain or lose as if you held it.
Margin
Margin is the deposit your broker holds while you have a position open. It isn't a fee or a cost, and you get it back when you close the trade. There are a few kinds:
- Initial margin: what the exchange requires to hold a contract overnight.
- Maintenance margin: the level your account must stay above, or you'll get a margin call.
- Day-trading margin: a lower amount many brokers allow for positions you close before the session ends. It's set by your broker and can change, especially before big events.
Low day-trading margin is what lets people trade big contracts with small accounts. That's convenient, and it's also how small accounts disappear quickly.
Leverage
Leverage is how much exposure you control compared with the money in your account: contract value ÷ account size. With a $5,000 account:
| Position | Exposure | Leverage | A 1% move in the S&P (about 68 points) |
|---|---|---|---|
| 1 MES | $34,000 | About 7× | $340 |
| 1 ES | $340,000 | About 68× | $3,400 |
A 1% move is a normal day. With 1 ES on a $5,000 account, a normal day can wipe out two thirds of it. That's why starting with micro futures makes so much sense.
What it means in a prop account
In a prop firm account you don't post margin; the firm handles that. Your real limits are the maximum number of contracts and the max loss limit. Turn your max loss into points to see how much room you actually have:
- $2,000 max loss trading 1 ES: 40 points of room in total.
- $2,000 max loss trading 1 MES: 400 points of room.
- $2,000 max loss trading 2 NQ: 50 points of room.
Seen that way, a 50K account trading full-size contracts is not much room at all. Here's more on ES vs NQ vs micros and on contract limits and scaling plans.
Put the numbers to work
Before every trade, know how many points your stop is from your entry and what that costs in dollars. The position size calculator does it for you: enter your risk in dollars and your stop as a price or a distance in points, and it tells you how many contracts fit. Market Matrix uses the same point values to work out P&L when you import trades.
This article is for education only and isn't financial advice. Tick and point values are from CME contract specs; margin requirements are set by exchanges and brokers and change over time. Prices in the examples are rounded. Trading futures involves substantial risk of loss.