A tick is the smallest increment a futures contract’s price can move. Price does not slide continuously; it jumps from one tick to the next. Tick size is how big that jump is in price terms, and tick value is what it is worth in money. Get these two numbers wrong for the contract you trade and every stop, target and position-size calculation you make is wrong with them. They are the most basic numbers in futures, and skipping them is why a lot of new traders blow up.
They also matter directly for order flow: every cell on a footprint chart is one tick of price, so understanding the tick is understanding the grid you read the flow on.
Tick size vs tick value
Two numbers, one for price, one for money:
- Tick size is the minimum price movement, expressed in the contract’s price units. For the ES (E-mini S&P 500) it is 0.25 index points. Price can be 5,400.00 or 5,400.25, but never 5,400.10.
- Tick value is what one tick is worth per contract in cash. For the ES it is $12.50. Every tick the price moves, you make or lose $12.50 per contract held.
The tick value comes from the contract’s multiplier. The ES has a $50 multiplier (each full index point is worth $50 per contract), and a tick is a quarter point, so one tick is $50 × 0.25 = $12.50. That relationship, multiplier times tick size, gives you the tick value for any contract.
Tick and point are not the same
People say “the ES moved 5 points” and “the ES moved 20 ticks” and mean the same thing, which confuses newcomers. A point is a full unit of the index; a tick is the minimum increment. For the ES, one point equals four ticks (because the tick is 0.25). One ES point is worth $50; one ES tick is worth $12.50. Always know how many ticks make a point for your contract, because stops and targets are usually thought of in ticks but quoted in points.
Tick values for common contracts
Here are the numbers for the contracts order flow traders use most. Always verify against your broker’s current specs, but these are the standard values.
| Contract | Market | Tick size | Tick value | Point value |
|---|---|---|---|---|
| ES | E-mini S&P 500 | 0.25 | $12.50 | $50 |
| MES | Micro S&P 500 | 0.25 | $1.25 | $5 |
| NQ | E-mini Nasdaq 100 | 0.25 | $5.00 | $20 |
| MNQ | Micro Nasdaq 100 | 0.25 | $0.50 | $2 |
| CL | Crude oil | 0.01 | $10.00 | $1,000 |
| GC | Gold | 0.10 | $10.00 | $100 |
| 6E | Euro FX | 0.00005 | $6.25 | — |
Notice the micros (MES, MNQ) share the same tick size as their big siblings but a tick value one-tenth as large, because the micro contract is one-tenth the size. That is exactly what makes them the sensible place to start, which is the whole point of micro futures.
Why the tick defines your risk
Every trade’s risk is just ticks times tick value times contracts. That is the entire equation, and it is why the tick is the foundation of sizing.
Say you trade the ES, enter long at 5,400.00, and put your stop at 5,395.00. That is a 5-point stop, which is 20 ticks. At $12.50 a tick, one contract risks 20 × $12.50 = $250. Trade three contracts and you risk $750. If your rule is to lose no more than $300 on a trade, one contract fits and three does not, and you knew that before entering, purely from the tick math.
This is where tick value plugs straight into position sizing for futures: you work backward from the dollars you are willing to lose and the tick distance to your stop to find how many contracts you can hold. Get the tick value wrong and the whole calculation collapses. Trade the NQ thinking in ES tick values and you will size the position badly, because an NQ tick is $5.00, not $12.50, even though both have a 0.25 tick size.
The same stop, different dollars
A 10-tick stop is not a fixed amount of money, it depends entirely on the contract:
- 10 ticks on the ES = 10 × $12.50 = $125 per contract
- 10 ticks on the NQ = 10 × $5.00 = $50 per contract
- 10 ticks on the MES = 10 × $1.25 = $12.50 per contract
- 10 ticks on CL = 10 × $10.00 = $100 per contract
Same number of ticks, wildly different risk. This is why you internalize the tick value of whatever you trade before you place a single order.
The tick and the bid/ask spread
The tick also sets the tightest possible spread. In a liquid contract like the ES, the bid/ask spread is usually exactly one tick, 0.25 points, because there is so much resting liquidity at every price. In thinner contracts the spread widens to several ticks. Since crossing the spread with an aggressive order costs you that spread, the tick value is also the unit of your transaction cost every time you take liquidity.
For how all of this fits into reading executed order flow, start from order flow trading, and check the order flow glossary for any term you want defined quickly.
Frequently Asked Questions
What is the tick value of the ES?
One ES tick is 0.25 index points and is worth $12.50 per contract. Since the ES has a $50 point multiplier and four ticks make a point, each tick is $50 × 0.25 = $12.50. On the micro version, the MES, the same 0.25 tick is worth just $1.25.
How do I calculate tick value for any contract?
Multiply the contract’s point multiplier by its tick size. For example, the NQ has a $20 multiplier and a 0.25 tick, so the tick value is $20 × 0.25 = $5.00. Your broker’s contract specifications list the multiplier and tick size for every product.
Why does tick value matter for risk?
Because your dollar risk on a trade is ticks to your stop times tick value times number of contracts. If you do not know the tick value, you cannot know how much money a stop actually risks. Two contracts with the same tick size can risk very different amounts, which is why you size positions off tick value, not off ticks alone.
Are tick size and tick value the same across all futures?
No. Each contract sets its own. The ES and NQ share a 0.25 tick size but have different tick values ($12.50 vs $5.00). Crude oil ticks in $0.01 increments worth $10 each. Always check the specs for the specific contract before trading it, and never assume one contract’s numbers apply to another.