What Are Copper Futures (HG)? Contract Breakdown for New Traders
Copper futures (HG) are the CME’s benchmark contract for trading global copper demand, industrial cycles, and macro growth expectations. The contract is simple: understand how it’s sized, how it moves, and what drives it.
Core HG Contract Specifications
HG is a straightforward metals contract. If you’ve traded gold or silver, the layout is familiar but the behavior is tied more tightly to global manufacturing.
- Contract Size: 25,000 pounds of copper
- Tick Size: $0.0005
- Tick Value: $12.50
- Settlement: Physical (COMEX)
- Active Months: Jan, Mar, May, Jul, Sep, Dec
Once you memorize the tick math, HG becomes predictable compared to FX contracts and even cleaner than ES on some trend days.
How Copper Futures Are Priced
Copper trades in dollars per pound. Each 0.01 move equals $250. Traders blow up when they underestimate the effect of small decimal changes.
Example Price Movement
- HG moves: 3.8500 → 3.8520
- That's 2 ticks
- 2 × $12.50 = $25
This scaling matters on high-volatility macro days when copper can move 60–100 ticks without hesitation.
Who Trades Copper Futures?
HG volume is driven by real industry, not random speculation.
- Manufacturers hedging production costs
- Macro funds trading growth expectations
- Speculators using HG as a risk-on/risk-off gauge
- Commodity index roll flows
Because it's tied directly to economic activity, copper often trends cleaner than profile-based tools.
Why Copper Moves
The contract responds to real economic signals. Copper earns its “growth metal” nickname.
- China’s industrial output
- LME/COMEX inventory levels
- U.S. PMI and ISM reports
- Housing and construction cycles
- Dollar strength or weakness
Ignore these and you’re guessing, not trading.
HG Risk Profile
Copper is volatile, but logical. It trends hard when macro conditions align and consolidates cleanly when demand softens.
Common Mistakes
- Oversizing because ticks look “cheap”
- Trading in low-volume gaps between sessions
- Ignoring global inventory data
- Failing to map previous swing highs/lows
HG rewards disciplined execution and punishes impatience.
Final Takeaways
Copper futures (HG) give you a direct line to global growth, but you must respect the contract’s size, tick value, and macro sensitivity. If you master the mechanics and track the right fundamentals, HG becomes one of the cleanest metals to trade.