Mini Futures

Mini Futures or popularly known as E-minis are part of futures contract that are traded electronically and they represent a portion or a percentage of the corresponding standard futures contract. They are an ideal financial instrument for a beginner due to:

-Access round the clock trading
-Advantage of low margin low margin rates
-They have less volatility and liquidity

The most common Mini Futures stock index contracts include the following:

– E-mini NASDAQ-100 (NQ)
– E-mini Dow (YM)
– E-mini S$P 500 (ES)
– E-mini Russell 2000 (TF)
– E-mini S$P MidCap 400 (EMD)

The NQ, YM, ES and EMD are trded electronically on the CME Globex platform. The TF is traded on the Intercontinental Exchange (ICE), an electronic trading platform.

Mini Futures have the following characteristics which make them popular trading instruments:

– They have a high Average Daily Volume (ADV).
– They have a flexible or good liquidity to ensure that a trader get in and out of a trade quickly.
– They have a low volatility making the trader have a high possibility of making a profit
– They can be traded 24 hours a day because traders use electronic platforms from all parts of the world.
– Affordability as traders can access the indexes positions without a full contract. This gives attractive margin rates.
– With Mini Futures, traders can enter both long and short trade positions making a higher potential for profits.