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What is It? [top]

E-Mini contracts are smaller electronically traded versions of the S&P 500 stock index. They are 1/5 the size of the larger institutional contracts. E-Minis are traded electronically on your PC.

Why Trade Them? [top]

1. Volatility creates opportunity to earn much more with lower account balances
2. Broad market exposure for low cost
3. You can hedge against your own portfolio
4. You can be profitable regardless of market direction

The Case for Trading Futures: The Traders Have Voted! [top]

In a little over 4 years, since inception, average daily volume of the E-mini S&P 500 has grown from 11,000 contracts to nearly 240,000 contracts.

 

 

 

 

Trading Advantages [top]

Ease of use versus stocks:

• Totally electronic platform with fast, efficient fills and virtually 24-hour trading
  
• “Round Trip” versus in-and-out commission
  
• Monitoring a few key indexes vs. dozens of stocks thus eliminating traditional stock picking and associated risks such as:
  
  • Pre-announcements
    
  • and now…accounting minefields
    
    
• Excellent profit potential
  
  

Ease of use versus options:

• Rocket Science Factor
  Options traders can call market correctly and still lose money because they must juggle 4 items:
  • underlying price
    
  • strike price
    
  • volatility
    
  • time decay
    
    
• Futures traders care about only 2 things:
  • an advancing market or
    
  • a declining market.
    
    
• Futures have more constant order flow and are usually much more friendly regarding bid/offer spreads.

E-Mini Contract Specifications [top]

	E-mini S&P 500	E-mini Nasdaq-100	E-mini Russell 2000	E-mini S&P Mid Cap 400
Ticker Symbol	ES	NA	ER2	EMD
Contract Size	$50 x E-mini S&P Futures price $55,000	20 x E-mini Nasdaq-100 Futures price $30,000	$100 x E-mini Russell 2000 Futures price $49,000	$100 x E-mini Mid Cap 400 Futures price $55,000
Min. Price Fluctuation (Tick)	.25 futures index points = $12.50	.50 futures index points = $10.00	.10 futures index points = $10.00	.10 futures index points = $10.00
Trading Hours	Virtually 24 Hours	Virtually 24 Hours	Virtually 24 Hours	Virtually 24 Hours
Contract Months*	H, M, U, Z	H, M, U, Z	H, M, U, Z	H, M, U, Z
Last Day of Trading	8:30AM 3rd Friday of contract month	8:30AM 3rd Friday of contract month	8:30AM 3rd Friday of contract month	8:30AM 3rd Friday of contract month
Performance Bond Initial **	$3,938	$4,125	$4,350	$3,125
Performance Bond Maint.	$3,150	$3,300	$3,480	$2,500

*H=March, M=June, U=Sept, Z=Dec
** CME minimum performance bond margins as of 1/31/02 SUBJECT TO CHANGE

 

What is 1 point of the E-mini S&P 500 worth? [top]

$50 per point per contract

For example: if the S&P 500 Index value is at 1500 and goes up 5 points to 1505 the difference is 5 points which equals $250.

$50 x 5 = $250 profit or loss per contract.

 

Source,; Exchange Traded Funds & Emini Stock Index Futures  By David Lerman