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The E-mini S&P 500 contract is for both new and experienced traders. But its smaller size was designed with the individual investor in mind. The contract value is 50 times the underlying index, just 1/5 the size of the “big” contract. For example, if the underlying S&P 500 futures is 1400.00, then one contract has a value of $70,000.
With the E-mini, a trader never actually owns any of the component stocks of the S&P 500 index. The E-mini, like all futures contracts, are legally binding agreements to buy or sell the cash value of the contract at a specific future date. All E-mini contracts are settled in cash, called offset, where a buy position is closed by a sell position, or vice versa.
Futures contracts are “marked-to-market” meaning margin accounts are adjusted daily to reflect profits and losses. If there is a net gain on any given day, it is noted in the account at the end of the day. Conversely, if there is a loss, it too is marked to the market and reflected in the account at the end of the day.
E-mini Nasdaq 100 chart with stochastics and MACD tech indicators
If gains accumulate, traders can remove the profits from the account. If there are losses that drop the account below the minimum “maintenance” margin requirement, your broker can close out your positions and specify that you deposit additional money to continue trading, an action called a "margin call." You can also lose all of your margin—and more—if the market were to make an unexpected move against a position and you had not pre-arranged to exit by placing a stop loss order.
The minimum price movement of the E-mini contract—called a "tick"—is also smaller than the larger contract. The tick value is .25 index points, or $12.50 per contract. This means that if the futures contract moves the minimum price increment (one tick), say, from 1400.00 to 1400.25, a long (buying) position would be credited $12.50; a short (selling) position would be debited $12.50. Also, a one-point move (four ticks) is $50.00 per contract ($12.50 times four ticks). This means that if a trader enters a long position at 1400.00 and covers the position at 1410.00, $500 is credited to his account. Conversely, if the E-mini declines from 1400.00 to 1390.00, and the trader had taken a long position, he would have a $500 loss debited to his account.
During the week, the E-minis trade virtually around the clock, pausing for just 30 minutes between 4:15 and 4:45 PM ET. On weekends, trading stops at 4:15 PM ET on Fridays and then resumes at 6:30 PM ET on Sundays.
Learn to Trade E-minis at Online Trading Academy
We will teach you all aspects of the E-mini Futures trading arena, using the latest tools and software. You will learn to control your own order flow by using the state-of-the-art Globex for index Trading. You will learn how the pros make money and learn the differences between E-mini’s and equities trading. Decide for yourself which is the best instrument for you. Don’t be surprised to find that you can use BOTH in harmony. You will also find our mentors to be a wealth of information and very helpful to your trading.
E-mini Futures Trading Courses Curricula
E-mini Futures
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While better-resourced individuals and institutions participate by trading the S&P futures, the $23,000-plus margin per contract required to trade the "big" S&P 500 futures is prohibitive. The phenomenal growth in the value of the S&P 500 futures has put the contract beyond the reach of many individual investors. The E-mini S&P 500 is a scaled-down version of the S&P futures that lets traders get in on the fast action of the electronically traded futures contract. Small contracts also exist on other large indexes.