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Newbie to Futures: Margin relative to account size

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Legendary Market Chamois
Chicago, IL
 
Trading Experience: None
Platform: NT8,NT7,TWS,FOREX.COM app
Broker/Data: InteractiveBrokers, NinjaTrader Brokerage FOREX.COM, IQFeed
Favorite Futures: The one I'm creating in the present....ES, ZF, ZN, ZB, FX pairs
 
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matthew28 View Post
Hi Sienna,

Also remember how much an ES contract is worth. The ES is currently at a value of about 2,000, with a big point value of $50 ($12.50 per tick). Therefore one contract of the ES is worth about $100,000. The same as a full size 100K forex contract ($10 per pip), or ten mini 10K contracts ($1 per pip), or 100 micro 1K contracts ($0.10 per pip). Think about how many contracts, or the value, you traded in your forex account. Sometimes people forget how large a futures contract is and trade far too much size. Apologies if stating the obvious.


The notional value of a futures contract means very little to 99% of retail traders speculating on ES day trades or even on trades lasting a few weeks. Now if one is holding to expiration that is a different story all together ie take delivery.
Ron


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