Futures Contract Specifications Explained
Every futures contract has four specs that determine how much you win, lose, or risk per movement: tick size, tick value, multiplier, and minimum price fluctuation. If you don’t understand these, you don’t understand your product.
Tick Size
Tick size is the smallest price increment the contract can move. Examples:
- MES: 0.25
- MNQ: 0.25
- GC: 0.10
Tick Value
Tick value is how much each tick is worth in real dollars. This is the number that hits your P&L.
- MES: $1.25 per tick
- MNQ: $0.50 per tick
- GC: $10 per tick
Multiplier
The multiplier converts the index price into contract value. You don’t need it for intraday trading, but you do need it for understanding exposure.
- MES: $5 multiplier
- ES: $50 multiplier
- MNQ: $2 multiplier
Minimum Price Fluctuation
The minimum price movement equals the tick size in 99% of contracts. Gold is a rare case where price may quote smaller increments, but the tick value only applies to the official tick size.
Side-by-Side Comparison
| Contract | Tick Size | Tick Value | Multiplier |
|---|---|---|---|
| MES | 0.25 | $1.25 | $5 |
| MNQ | 0.25 | $0.50 | $2 |
| GC | 0.10 | $10 | 100 |
Why These Specs Matter
You can’t measure risk, reward, or probability unless you know exactly what each tick means. These specs are the backbone of contract behavior and the foundation for sizing, margin, and break-even math.