Palladium Futures Tick Size, Tick Value, and Margin Explained
Palladium futures tick size and margin rules matter more than most beginners realize. PA is a thin contract, a fast mover, and every tick costs real money. If you don’t understand how the tick structure and margin interact, you’re gambling, not trading.
The Exact Tick Size and Tick Value for Palladium Futures
The PA contract uses a half-dollar tick. That sounds harmless until you remember each tick is fifty bucks.
| Component | Value |
|---|---|
| Minimum Tick | $0.50 |
| Tick Value | $50 per tick |
| Contract Size | 100 troy ounces |
Four ticks is $200. A ten-tick sweep is $500. These moves happen constantly because PA has almost no depth during quiet hours.
Why PA Tick Behavior Is More Violent Than Gold or Silver
The thin order book means ticks don’t behave “one at a time.” You get gaps. You get slippage. You get two-tick jumps instantly. This is nothing like the smoother behavior you get in GC ATR flows or heavily traded equity index futures.
- Thin resting liquidity
- Larger price jumps per order
- Unstable bid/ask spread
- Consistent slippage on market orders
If you expect PA ticks to fill like ES or CL, you’re in for an unpleasant surprise.
How Margin Works for Palladium Futures
Margin is where most retail traders blow up because they underestimate the volatility. CME sets a baseline requirement, but brokers add buffers because PA can spike harder than any major metal.
- Initial margin: high due to volatility
- Maintenance margin: nearly as high as initial
- Overnight margin: typically the highest
The point is simple: PA is expensive to hold because it moves too fast for shallow margin.
Practical Position Sizing for PA
Because the tick value is large, you must size with respect to your account and the contract’s behavior. You don’t scale into PA like you do in SI or ZN. One contract is already meaningful risk.
Position sizing reality check
- Expect 10–30 tick swings during volatile periods
- Expect spread widening during low-liquidity hours
- Expect margin calls faster due to large point value
If this sounds harsh, good. PA is harsh.
Numerical Examples: Realistic PA Scenarios
Here’s what the contract can do to you with no warning:
- A 12-tick move: 12 × $50 = $600
- A 25-tick spike: 25 × $50 = $1,250
- A 40-tick liquidation sweep: $2,000 lost instantly
Scenarios like that are why PA margin sits above more liquid metals. If you want a smoother metal, read the PL overview. PA is the aggressive sibling.
Final Takeaways
Palladium futures tick size and margin aren’t trivia — they’re the whole risk profile. The half-dollar tick is extreme, the $50 tick value is unforgiving, and the margin reflects how explosive this contract is. If you don’t respect PA’s structure, you won’t last a week.