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      Course Overview
      • Definition of a Futures Contract
      • Learn About Contract Specifications
      • Understanding Contract Trading Codes
      • Get to Know Futures Expiration and Settlement
      • Tick Movements: Understanding How They Work
      • What are Price Limits and Price Banding?
      • About Contract Notional Value
      • Mark-to-Market
      • Margin: Know What's Needed
      • Understanding Futures Expiration & Contract Roll
      • Price Discovery
      • Calculating Futures Contract Profit or Loss
      • Understanding the Role of Speculators
      • Understanding the Role of Hedgers
      • Trading Venues (Pit vs. Online)
      • Midwest Grain Trade: History of Futures Exchanges
      • Futures Contracts Compared to Forwards
      • What is Volume?
      • Open Interest
      Introduction to Futures
      You completed this course.Get Completion Certificate

      Tick Movements: Understanding How They Work

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      Minimum Price Fluctuation

      All futures contracts have a minimum price fluctuation also known as a tick. Tick sizes are set by the exchange and vary by contract instrument.

      E-min S&P 500 tick

      For example, the tick size of an E-Mini S&P 500 Futures Contract is equal to one quarter of an index point. Since an index point is valued at $50 for the E-Mini S&P 500, a movement of one tick would be

                         .25 x $50 = $12.50

      NYMEX WTI Crude Oil

      The tick price of a NYMEX WTI Crude Oil contract is equal to one tenth of a point, and since a point is valued at $1000, the tick price is $10. The NYMEX WTI Crude Oil contract is quoted therefore in increments of .01.

      Summary

      Tick sizes are defined by the exchange and vary depending on the size of the financial instrument and requirements of the marketplace. Tick sizes are set to provide optimal liquidity and tight bid-ask spreads.

      The minimum price fluctuation for any CME Group contract can be found on the product specification pages.


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      CME Group is the world's leading and most diverse derivatives marketplace. The company is comprised of four Designated Contract Markets (DCMs). 
      Further information on each exchange's rules and product listings can be found by clicking on the links to CME, CBOT, NYMEX and COMEX.

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