Lesson 2 of 7 · 2 min
Ticks & spread
Tick sizes, tick values, the bid–ask spread, and how quotes update.
Futures prices don't move continuously; they move on a fixed grid set by the exchange.
The tick grid
Definition
The tick size is the minimum price increment. For the E-mini and Micro E-mini S&P 500 and Nasdaq-100 contracts, it's 0.25 index points. The tick value is what one tick is worth in dollars per contract.
| Contract | Tick size | Tick value |
|---|---|---|
| ES | 0.25 | $12.50 |
| MES | 0.25 | $1.25 |
| NQ | 0.25 | $5.00 |
| MNQ | 0.25 | $0.50 |
Always check current specifications with the exchange (CME Group).
The spread
The spread is the difference between the best offer and the best bid. In very liquid markets it's usually one tick, and the cost of crossing it — buying at the offer and selling at the bid — is a real, repeated cost of trading.
Key Insight
A one-tick spread looks tiny, but you pay it on entry and exit whenever you use market orders. On small stops that cost is a meaningful share of your risk.
Quote mechanics
A quote is the current best bid and offer with their sizes. Quotes update when orders are added, cancelled, modified or filled. Fast-moving quotes with few trades usually mean liquidity providers are repricing — not that anyone is trading.
Trading implication
Know your tick value before anything else. Every stop, target and size calculation runs through it.
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