Understanding Mini Russell 2000 Index


Mini Russell 2000 Index, sounds like a futuristic robot. However, it is one of the most popular tools in Future option trading. The Russell index Futures Index is designed to reflect the total return performance of the future contracts. This tool is used as pre-determined methodology for standard roll schedule in future contracts. In addition, it is one of the most efficient and cost-effective solution to gain market exposure to stock market.

Mini Russell 2000 Index is a broad-based index that tracks 2000 small cap stocks covering a wide variety of sectors. It is essentially considered a key benchmark for small cap U.S market. It allows the participants to take position on the performance of the Russell 2000 Index.

Why Do Traders Find Russell 2000 Appealing?

Well, there are various reasons. It may include the board exposure to the most attractive companies – they can invest. Since the index tracks many smaller companies that operate in domestic market – it can also serve as a barometer of U.S. economy.

What Is Russell 2000?

In simple term, it is an index a slick financial tool that tracks the performance of 2000 small cap companies with the U.S.A. Typically it helps to track the performance of the smallest companies in the index.

How to Russell 2000 Work?

Well, essentially Russell 2000 Futures are financial contracts traders can buy and sell where the commodity at stake is not wheat or gold – however, shares from the Russell 2000 index. Typically, you are betting on the future performance of the small-cap stocks.

These future contracts represent $100 times the index. Evert tick or smallest price movement is 0.10 hence, equivalent to $10. These contracts expire in March, June, September and December. You should understand the specs as it can impact potentially in gain, losses and overall trading strategy.

Bottom Line

The ultimate purpose of trading Russell 2000 futures is to make money. It offers better exposure to a broad market sector without buying the individual stock. Additionally, it helps to speculate on market direction and hedge exposure and control the risk of unfavorable market swing.

Comments

Popular posts from this blog

Unlocking Opportunities with S&P 500 E Mini Futures Trading

Navigating the Financial Frontier: A Guide to E Mini S&P 500 Futures Options at E-Mini.com

E-Mini.com: Charting Tomorrow - Unleashing the Power of E-Mini S&P 500 Futures on Interactive Brokers