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AN INSIGHT
TO DAY TRADING

TOP 3 INDEX FUTURES


An index instrument in the financial markets represents an asset basket based on the underlying assets or companies within the index. That data indicates a picture that market participants can compare current price levels with the past receiving a view of the current market performance. Indices focus on a variety of sectors while also varying in size. Some index instruments focus on technology others on agriculture tracking just a handful underlying titles up to a few hundreds.


An index future in that sense illustrates a contract to buy or sell a certain value of the underlying index on a future date at the specified price. In order to make futures trading more accessible to the broad market, index future contracts with a smaller lot size have been introduced – the e-mini and e-micro.


Index futures are traded globally with the CME Group from the United States being the most popular one with regards to traded volume.


E-MINI S&P500

The S&P500 has its origin in the 1920s, when Standard & Poor’s introduced a series of indices that included 233 companies and covered 26 industries. The S&P500 as its knows today was introduced in 1957 and represents a benchmark for the equity market in the United States. According to the Global Industry Classification Standard, the S&P500 covers 11 sectors: the energy, materials, industrials, consumer discretionary, consumer staples, health care, financials, information technology, communication services, real estate, and utilities. Therewith, the index represents more than 83% of the total domestic equity market capitalisation in the United States.


The S&P500 is market capitalisation-weighted and, consequently, the largest companies in the index account for a substantial part of its total market capitalisation and have the greatest influence on the index’s performance. Among the largest companies in the index are Microsoft, Apple, Amazon, Tesla, Alphabet and Meta.


The actual ES futures contract was introduced by the CME on September 9, 1997. The E-mini future quickly turned into the most popular equity index future contract globally. E-mini futures have been traded through the all-electronic Globex system which was especially preferred by Hedge Funds compared to the original S&P500 which still was traded through traditional pit trading method.


Today, the e-mini futures are traded via the Globex, part of the CME Group in the United States exceeding 1 million traded contracts per day.

E-MINI S&P500 CONTRACT SPECS

Contract Unit

$50 x S&P 500 Index

Price Quotation

U.S. dollars and cents per index point

Trading Hours

Sunday 5:00 p.m. - Friday - 4:00 p.m. CT

Minimum Price Fluctuation

0.25 index points = $12.50

Product Code

ES

Listed Contracts

Mar, Jun, Sep and Dec

Settlement Method

Financially Settled

Last Trading Date

Trading terminates at 8:30 a.m. CT on the 3rd Friday of the contract month.

Settlement Procedures

Exchange

CME


E-MINI NASDAQ

The National Associate of Securities Dealers (NASD) introduced the Nasdaq index in 1985. It is a securities exchange market index that lists 100 of the biggest and most actively traded companies in the United States. The Nasdaq 100 does not include any financial companies but many other industries such as technology, retail, industrial, telecommunication, healthcare, transportation, and media. The Nasdaq 100 is a modified capitalization-weighted index meaning listed stocks are weighted according to the total market value of their outstanding shares. The top companies listed are all from the technology sector and include Microsoft, Alphabet, Tesla, Meta, Apple, Amazon and Nvidia. Therefore, the index is also considered a technology index.


The actual Nasdaq futures contracts were first introduced by the Chicago Mercantile Exchange in 1996. Later in 1999, the CME Group also launched the E-mini Nasdaq futures making it more attractive for hedge funds to trade.


Today, the Nasdaq futures are traded via the CME Group in the United States with an average of around 700,000 contracts traded contracts per day.

E-MINI NASDAQ CONTRACT SPECS

Contract Unit

$20 x Nasdaq-100 Index

Price Quotation

U.S. dollars and cents per index point

Trading Hours

Sunday 5:00 p.m. - Friday 4:00 p.m. CT

Minimum Price Fluctuation

0.25 index points = $5.00

Product Code

NQ

Listed Contracts

Mar, Jun, Sep and Dec

Settlement Method

Financially Settled

Last Trading Date

Trading terminates at 8:30 a.m. CT on the 3rd Friday of the contract month.

Settlement Procedures

Exchange

CME


E-MINI DOW JONES

The Dow Jones Industrial Average was created in May 1896 by Charles Dow and his business partner Edward Jones. The underlying parts of the index were principally mainly industrial companies related to gas, sugar, tobacco, railways, and oil but has gone through a few changes throughout the years. In 1916, the DJIA components were updated from 12 to 20 stocks. They were then brought to 30 stocks in 1928 reflecting the performance of 30 stocks of leading blue-chip organisations in the United States, which also remains the standard today.


The DJIA was made to measure the developments of the leading organisations in the United States engaged in industrial activities. It utilises the price-weighted index, meaning that stocks with a higher share price carry a greater weight in the index than stocks with a low share price. Among the largest companies in the index by weight are the UnitedHealth Group, Goldman Sachs, Home Depot, Microsoft and McDonalds.


The actual Dow Jones futures contract was introduced by the CME in October 1997. The E-mini future quickly turned into one of the most popular equity index futures contract making it attractive for institutional as well as retail investors to trade.


Today, the Dow Jones futures are traded at the CBOT as part of the CME Group in the United States with an average of around 230,000 traded contracts per day.

E-MINI DOW JONES CONTRACT SPECS

Contract Unit

​$5 x Dow Jones Industrial Average index

Price Quotation

U.S. dollars and cents per index point

Trading Hours

Sunday 5:00 p.m. - Friday - 4:00 p.m. CT

Minimum Price Fluctuation

1.00 index point = $5.00

Product Code

YM

Listed Contracts

Mar, Jun, Sep and Dec

Settlement Method

Financially Settled

Last Trading Date

Trading terminates at 9:30 a.m. ET on the 3rd Friday of the contract month

Settlement Procedures

Exchange

CBOT