Newb trying to understand ZB and ZN

Discussion in 'Financial Futures' started by Gamer, Feb 8, 2009.

  1. Gamer

    Gamer

    Hi,
    I have read the contract specifications on the CBOT site many time, I still can't understand how tick values and points work on ZB and ZN, primarily because I am not used to fractional price quotes.

    For ZB, this is what it says on CBOT:
    "CBOT: Tick Size: Minimum price fluctuations shall be in multiples of one-half of one thirty second point per 100 points ($15.625 per contract)... Par shall be on the basis of 100 points."

    I understood here that the value of a tick is $15.625 per contract, and the size of a tick is 16/100, i.e. 0.16. Is that correct? I don't have a clue about the last sentence ('par shall be on the basis of 100 points').

    Then it says:
    "CBOT: Price Quote: Points ($1,000) and one-half of 1/32 of a point; i.e., 80-16 equals 80-16/32, 80-165 equals 80-16.5/32."

    Here this has completely confused me. Does this mean a point is worth $1,000? Is this the same point that was mentioned above in the context of the tick value? Where did this come from?

    Could someone please explain in plain English?

    I want to calculate the value of a daily range, how do I do that?
     
  2. ram

    ram

    Every 005 move is equal to 1 tick. For example, if price moves from 128'010 to 128'030, that's 4 ticks
     
  3. donnap

    donnap

    This is fairly straight forward, but I've been there in regards to exchange explanations.

    80 to 81 is a full point. $1000 per point.

    It may be helpful to use 320th with quotes.

    So 80.315 is 80 315/320

    The next tick would be 81.

    005/320 x 1000 = $15.625
     
  4. Gamer

    Gamer

    Thanks a lot.

    Why can't they write in simple English on the website? Seem to be almost in a mission to make it obscure.