look.... a 1 cent move in CL would be $10 and a 1 cent move in QM would be $5 (half... see it is a mini)... the only problem is that the QM can't move in penny increments... it can only move up or down in 2.5 cent increments... now thats $12.50... if the CL could move 2.5 cents that would represent a $25 move (proving that its the larger contract yet again since $25 is exactly twice as much as $12.50)... only problem is that it can't... it can only move in 1 cent increments remember.... so while its possible for your P&L on 1 contract to go from $10 to $20 to $30 in the CL, in the QM its only possible for your P&L to go from $12.50 to $25 to $37.50. However, by the time both contracts move 1 FULL POINT your P&L in the CL will be exactly twice as much as your P&L in the QM. The size of the tick is purely a function of whether the contract is traded in 1/10ths, 1/100ths, 1/1000ths, 1/8ths, 1/4's, 1/16ths, etc.... it has nothing to do with whether or not its considered a mini or full-sized contract. The fact that its appears to be different in respect to the ES/SP is partly coincidence, partly because the SP is 5 TIMES as large as the ES vs. the CL being only 2 times the size of the QM... partly because the QM trades in 2.5 cent increments vs. quarters in the ES... and partly because the CL trades in hundredths vs. tenths for the full size S&P.... in other words you're trying to compare apples and oranges.... they're two completely different contracts structured completely differently... of course they're not going to both exhibit the exact same spurious and irrelevant behavior... why would they? If you want to compare a mini vs. a full sized contract you really can't look at anything less than the monetary value of 1 FULL POINT to make the kind of comparison you're trying to make. And BTW... if you're wondering why the exchanges do stuff like this... its because the mini's are typically not as liquid as their full-sized counterparts and this is how they deal with it (or at least one of the ways they deal with it).
The concept of mini vs full size contract has been explained by 5 different traders 5 ways, yet you still do not get it! Have you even been to the NYMEX website? Do yourself a favor and pay it a visit, it's free.
i've got it... just that different traders have different views... many thanks to all,I believe this thread will benefir a lot of newbies/rookies...
I don't know if anyone mentioned this but the reason QM is $12.50 per tick and the CL is $10 per tick is because, the QM moves in 2.5 cent increments while CL moves in 1 cent increments. Even though the contract is half the size that is not explaining this confusion I see here. It is the same comparison as the ES and YM. I hope this helps the newbies.
I don't know if anyone other than you has noticed this, but you are a low-volume member of the forum responding to an 11-YO thread. Why do you plebes do this? You've been a member of this forum for 11 years. Why are you bumping this old stuff? Surely the participants in the thread figured it out by now? Oi! I mean, you really had to dig very very deep, I mean WAY down into this section to find this old thread.
I guess you don't know much about Google. It comes up high on its search list regardless of its age. So there are many people other than this thread that look up things on Google without being a participant of this thread. Lesson 101 for you.