Beginner's questions on the ES

Discussion in 'Index Futures' started by shark, Jul 21, 2008.

  1. shark


    Hi. I have recently taken interest in potentially trading the e-mini S&P500, but I know next to nothing about it. If you don't mind, someone please rid me of my ignorance.

    1. What is the cost per contract of the ES, and how many would I be able to trade with 5000 or 10000 dollars?
    2. What is a tick and how much $ does it represent?
    3. What is a point and how much $ does it represent?
    4.What profit potential is in the ES when compared to just day trading stocks?
    5. Are there any other factors to worry about, like for example an expiration date?
    6. What else makes trading the ES similar or different to trading stocks?
    7. Is the pricing structure of the ES (ticks, points) the same with other index futures such as the YM?
    8. What kind of margin is usually available in trading the ES and should I use it?

  2. Tums


  3. atonix


    1. An ES contract is worth (price * $50). You'll get different intraday margins than overnight. You can get $500 intraday/contract, but that's account suicide. Depending on your system, experience, and expected drawdown, your own money management answer will vary. Many people use $5k/car intaday.
    2. A tick is 0.25, or 1/4 points. It's worth $12.50
    3. A point is 4 ticks. $50/pt. (it's the whole numbers in the price)
    4. Depends on risk, your system, etc.. there is no answer. You can have *much* higher leverage, so you can also blow your account easier.
    5. 4 expiry's a year.
    6. Comission, leverage, volume, etc.
    7. For YM, 1 tick = 1 point = $5. NQ is $20/pt, $5/tick. etc
    8. Yes you will use it.. almost ES all trading is done on some type of margin. How much? See above, figure out a money managment system for yourself.
  4. ganesh6


  5. shark


    thanks for the overview
  6. shark


  7. Oh, and I wanted to add --

    This month __Technical Analysis of Stocks and Commodities__ magazine has an article titled "Intrabar Execution Tooks" that details how the author trades the emini Russell 2000. I found the details helpful and applicable to trading other index futures.

    -- Mom

  8. Shark, the potential is unlimited trading the es. If you can wear both hats then go for it. If i was to start all over right now and had to pick equities or futures to trade it would be futures. Good Luck
  9. I agree 100% Traderpro
    #10     Jul 26, 2008