Tick Size and Tick Value Definitions and Examples
Each financial market has a minimum price fluctuation called a tick. Each tick of movement is worth a specific amount of money. The size of a tick and its monetary value vary according to the asset being traded.
Tick Sizes and Values for Common Futures Contracts
The Euro FX (6E) futures contract has a tick size of 0.00005 U.S. dollar per euro. A contract is for 125,000 euros, so its price will move in increments of $6.25.
The E-mini S&P 500 (ES) futures contract has a tick value of 0.25. The dollar amount per move is $12.50 because the contract unit is $50 x the S&P 500.
Light sweet crude Oil (CL) futures move in increments of 0.01 per barrel. Because a contract is for 1,000 barrels, the dollar value moves in increments of $10.
Gold (GC) futures have a tick size of 0.10 per troy ounce. A contract is for 100 troy ounces, so the contract price moves in increments of $10.
Natural gas futures (NG) move in 0.001 increments per million British thermal units (MMBtu). Because a contract is for 10,000 MMBtu, the price moves $10 at a time.
Finding Other Futures Tick Sizes and Values
To determine the tick size and value of a different futures contract that's traded on a CME Group exchange, go to CME Group's website, move your cursor over Trading, and select a featured product or a category of products. Once you've found your particular contract, click on the Contract Specs tab. The tick size and dollar value will be given to the right of Minimum Price Fluctuation.
You can find the same information for contracts traded on another exchange by going to that exchange's website.
Tick Size and Value for Stocks
Stocks have a tick size of 0.01, which means that for all stocks trading above a dollar, the price moves in increments of 1 cent per share.
Calculating Profit and Loss
Those tick increments and values are based on one contract or share. To calculate how much you stand to gain or lose on each tick movement after having traded multiple futures contracts, multiply the tick value times the number of contracts you purchased.
For example, if you bought three contracts of the E-mini S&P 500 at 1623.25 and the price rises to 1624.25, you will have gained $150. That's because the price went up four ticks, so you would multiply $12.50 x 4 ticks x 3 contracts, which equals $150. If the price declines to 1620, you would have lost $487.50. The price went down 13 ticks, so you would multiply $12.50 x 13 ticks x 3 contracts, which equals $487.50.
Since stocks typically trade in 100-share units called lots, for every cent the price moves, you stand to make or lose $1 on each lot.
Why Tick Size and Tick Value Matter
Not knowing the tick size and tick value of the futures contract you are trading can result in taking position sizes that are too big or small relative to your expectations. Each contract moves a different amount each day relative to other futures contracts.
For example, during a certain period, the E-mini S&P 500 futures contract may move an average of 70 ticks a day while crude oil futures may move 150 ticks a day. Even though the tick values are similar for both contracts– $12.50 and $10, respectively—one market moves much more than the other. You would want to compensate for that difference when deciding how many contracts to trade.