1. Futures 101: The Basics
Unlike retail stock trading, where you own a piece of a company, futures markets are contracts to buy or sell an asset at a predetermined price at a specified time in the future. We trade highly liquid, electronically matched index futures like the E-mini S&P 500 (/ES) and the E-mini Nasdaq 100 (/NQ).
↕️ Ticks & Points
The minimum price movement of an instrument is a 'tick'. For the /ES, one point consists of 4 ticks. Each point represents $50 per standard contract. If the market moves 5 points in your favor, you make $250 per contract.
⚡ Leverage & Margin
Futures are highly leveraged instruments. To hold a single /ES contract, it requires significant margin equivalent to purchasing roughly $250,000 worth of stock. Prop firms abstract this requirement away.