Why are Interest rate futures traded in 1/32?

Discussion in 'Financial Futures' started by MP Trader NYC, Mar 15, 2011.

  1. I'm learning about trading T-Note and T-Bond futures and want to know why they trade in 32nd's?

    Any book/video/site recos are welcome.
  2. Because treasuries trade that way...
  3. Isn't anyone willing to help a newbie on this board?
  4. Some US markets still work on the English measurement system of fractions, as opposed to metric decimals. Cash Treasuries are quoted in fractions, so their futures follow suit. Stocks used to be quoted in fractions.
  5. Probably a carry-over from European influence in monetary system.

    Spain had "pieces of 8" coins... bonds might have been tic-priced on that concept... "1/8" of something being the smallest denomination.

    For bonds 1/8 was too large of a tic ?? So, 1/32 = 1/4 of 1/8.

    Also, in US money... "2-bits" = $.25, "4-bits" = $.50. Then, "8-bits" = $1.

    Stocks in US at one time had 1/8 as smallest tic... then went to 1/16 before decimalization.
  6. tomk96


    almost everything used to trade in fractions. the never moved to decimals. personally, i don't think it matters.