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The New Micro Contract - MICRO BITCOIN coming May 2021


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The New Micro Contract - MICRO BITCOIN coming May 2021

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  #1 (permalink)
 SMCJB 
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Micro Bitcoin futures coming May 3rd 2021.

edit At 0.1 Bitcoin and $60k it's a $6k notional contract (vs MES at 20k, MNQ 25K, M2K 10k, MGC $17k, SIL $13k)
(originally said it was 0.5 Bitcoin)

https://www.cmegroup.com/trading/micro-bitcoin-futures.html

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  #2 (permalink)
 addchild 
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SMCJB View Post
Micro Bitcoin futures coming May 3rd 2021.

At 0.5 Bitcoin and $60k it's a $30k notional contract (vs MES at 20k, MNQ 25K, M2K 10k, MGC $17k, SIL $13k)

https://www.cmegroup.com/trading/micro-bitcoin-futures.html

I believe its 0.1 bitcoin. so $6k notional.

.
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  #3 (permalink)
 SMCJB 
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@addchild corrects me before I can even correct myself!

I talked to CME and can confirm it is 0.1 Bitcoin, so 1/50th of a Full Size Contract.

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 FuManChou 
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Looks like it is $0.50 per tick per contract. This should be awesome!

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 SMCJB 
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Question will be.
a) Can you find a broker that will let you trade it (a surprising amount will not)
b) If so what will their margin requirement be (a surprising amount charge double CME margin)
c) and what will they charge to trade it?

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 jokertrader 
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An additional question would be regarding margining of spreads and their viability...would be interesting to see if we can model spread behaviour based on historic full size BTC future spreads
SMCJB View Post
Question will be.
a) Can you find a broker that will let you trade it (a surprising amount will not)
b) If so what will their margin requirement be (a surprising amount charge double CME margin)
c) and what will they charge to trade it?

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 jokertrader 
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A 5 dollar move on the outright is $0.50 - does that mean 58800 to 58805 is 1 tick or 1 step on the DOM and correlates to $0.50 gained or lost?

FuManChou View Post
Looks like it is $0.50 per tick per contract. This should be awesome!

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 SMCJB 
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jokertrader View Post
An additional question would be regarding margining of spreads and their viability...would be interesting to see if we can model spread behaviour based on historic full size BTC future spreads[/URL]

For all the other micros, the micro is completely fungible with full size contract. Even though products like SIL and MGC are physical delivery contracts, you can offset 10 MGC against 1 GC and have no physical obligation. So margin is offset able as well. edit: Spreads on full size are about $2k-$3k/contract so would expect micro to be about $40-$60. Problem is the spreads don't trade much AND the implication is switched off. So its just a bunch of Algo's ticking it each other trying to rip off the unsuspecting trader of a few ticks. edit2: Also commissions are so high on the full size that even with the reduced tick, the amount you need to make to cover commissions gets prohibitive.


jokertrader View Post
A 5 dollar move on the outright is $0.50 - does that mean 58800 to 58805 is 1 tick or 1 step on the DOM and correlates to $0.50 gained or lost?

Tick on the full size is $5 x 5 coins = $25
Tick on the Micro is $5 x 0.1 coins = $0.50
So 58800 to 58805 on full size is $25 and on micro will be $0.50

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 Big Mike 
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https://cointelegraph.com/news/cme-group-set-to-launch-micro-bitcoin-futures


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 FuturesTrader71 
 
 
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Hey traders,

Although I would welcome any micro-product in futures to help traders deleverage and reduce risk, I would draw your attention to the fee structure for this product before you decide to go scalp it or even trade it intraday.

Just as @Big Mike is, I'm an advocate for the independent trader and want to make sure folks are aware.

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 SMCJB 
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And before anybody asks, margin on the full-size contract is currently 42% of notional (has ranged from 35% to 42%), assuming these contracts are fungible it would be the same for the micro.

So Bitcoin $60k, CME Micro 0.1 Bitcoin = $6k Notional, with margin requirement of $2520,

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 SMCJB 
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FuturesTrader71 View Post
Although I would welcome any micro-product in futures to help traders deleverage and reduce risk, I would draw your attention to the fee structure for this product before you decide to go scalp it or even trade it intraday.

Unless I'm missing something the CME FAQ refers you to a CME Fee File that is effective 4/1/21 and as such does not have the Micro fees in it??

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 FuturesTrader71 
 
 
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SMCJB View Post
Unless I'm missing something the CME FAQ refers you to a CME Fee File that is effective 4/1/21 and as such does not have the Micro fees in it??

I see the same. I'm sure some more details are forthcoming. I simply didn't want FIO traders to believe that the cost structure supports scalping this product. I may be wrong.

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 SMCJB 
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Good Advice @FuturesTrader71. With the wide Bid/Ask (often 8/10 ticks on full size) it may look attractive, but it moves/gaps quickly, and Exchange and Broker fees are higher than most contracts. (At least for the full size).

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Nothing (futures related) is worth scalping unless one holds a seat and gets reduced fees.

Folks are kidding themselves like the Robinhood crowd that is trading commission-"free".

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lightsun47
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Nothing (futures related) is worth scalping unless one holds a seat and gets reduced fees.

Folks are kidding themselves like the Robinhood crowd that is trading commission-"free".

And what about guys who trade on 100 lots and scalp 10-15-20 points a day SUCCESSFULLY?

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 Tripken 
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lightsun47 View Post
And what about guys who trade on 100 lots and scalp 10-15-20 points a day SUCCESSFULLY?

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Yep, and can be done with a lot less contracts and a bit fewer points per day...just gotta know how!!

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lightsun47 View Post
And what about guys who trade on 100 lots and scalp 10-15-20 points a day SUCCESSFULLY?

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100 lots @10-15-20 points a day is not scalping.

That is called highly improbable to it day after day.

Don't believe everything you see on youtube.

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travelbrit
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Totally agree spreads and fees will make all the difference, otherwise I think it is an great idea

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lightsun47
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SunTrader View Post
100 lots @10-15-20 points a day is not scalping.

That is called highly improbable to it day after day.

Don't believe everything you see on youtube.

Check your PM.

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 Al3cs 
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lightsun47 View Post
Check your PM.

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Send it to me too please, too courious to miss it

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