Understanding the Aspects of E-Mini Future

E-mini refers to electronically traded future contracts. E-mini futures are used to trade a variety of assets like commodities and currencies. However, the most commonly traded assets are E Mini Dow Jones Futures.

You can trade 24 hours a day with E Mini Dow Jones Futures and take the advantage of potential trading opportunities. Regardless of the market direction, micro e-mini Dow tick value also offer the ability to trade with greater leverage and can allow a more efficient use of trading capital.

E-Mini Future Trading; an Overview

The Chicago Mercantile Exchange has launched the first e-mini futures to offer individual investors for those whom standard contract size was expensive. Like any other futures contracts, E-minis are traded on the CME and other exchanges, enabling investors to hedge their bets and speculate on the price movements of the underlying asset.

Understanding E-Mini

All future contracts obligate the holder to buy and sell assets like physical commodity and financial instrument at a predetermined future date and price. Some future contracts might call for physical delivery of the assets and others can be settled in cash.

Future contracts are typically accessible to the institutional investors for their size. These contracts are often seem too large for small investors. The first e-mini contract allowed the traders to trade S & P 500 futures. The value was set at one-fifth of the full-sized contract.

Over time, the E-mini contracts quickly became successful and led to other similar contracts. There are different E-mini contracts that cover various assets:

•   Indexes

•   Currencies

•   Commodities

Among all, the S&P 500 became the most actively traded E-mini contract in the world. Like any futures contracts – trader uses single E-min contract to the hedge and speculate on board market move. Since, these contracts are traded electronically; E-mini futures contracts can be traded almost 24 hours a day. To start, investors are required to open an account with brokerage.

Bottom Line

Well, there are not many differences between e-mini contracts and full-sized future contracts. The smaller contract allows the investors to hedge and speculate on price movement of the assets – be it index, commodity or currency.