Field Manual · Futures Trading Terms

Futures Trading Terms Every Trader Should Know

One term per page. One short video per term, in George’s voice. Learn the language before you risk a dollar.

19 Terms
Explained

EVERY TERM HAS A VIDEO AND A WRITTEN LESSON NEW TERM EVERY WEEKDAY 187 TERMS IN THE SERIES

Every futures trader starts by learning the words. What a tick is worth. What margin really means. Why the ES and the MES move the same and pay differently. This series takes the terms every trader should know and gives each one its own page… a short video in George’s voice, the definition in plain words, an ES example with real numbers, and the questions traders ask about it.

The videos publish in order, one every weekday, starting with contract mechanics and working forward through risk, orders, price action, sessions, economic events, and the slang you hear in the room. The full list already lives in the Trading Glossary. This is where each term gets the full treatment. When you are ready for the strategy behind the words, the Trading Library and the Core Strategy pick up from here.

Contracts & Mechanics

No. 3What Is Futures Contract?

A legally binding, standardized agreement traded on a regulated exchange to buy or sell a specific asset at an agreed price on a set future date.

No. 4What Is Tick?

The smallest price increment a futures contract is allowed to move, with a fixed dollar value assigned to it by the exchange..

No. 5What Is Tick Value?

The dollar amount gained or lost for each one-tick move in a futures contract, found by multiplying tick size by the contract's dollar multiplier..

No. 6What Is Point?

A full one-unit move in a futures contract's price, made up of a fixed number of ticks depending on the contract's specifications..

No. 7What Is Day Trading Margin?

The reduced minimum account balance a broker such as Tradovate requires per contract to open and hold a futures trade during the day, for trades that are closed before the broker's daily cutoff, 15 minutes before the session close.

No. 8What Is Initial Margin?

The amount of account equity required to hold a futures position past the daily session close and through the settlement break into the next session.

No. 9What Is Maintenance Margin?

The minimum account equity, set by the exchange, required to keep carrying a position that was established under initial margin across sessions.

No. 10What Is Leverage?

The ability to control a large notional futures position using a comparatively small margin deposit, which magnifies both potential gains and potential losses..

No. 11What Is Margin Call?

A broker's demand for additional funds after an account's equity falls below the maintenance margin level, usually due to an adverse price move..

No. 12What Is Notional Value?

The total market exposure represented by one futures contract: index price times the contract multiplier.

No. 14What Is Expiration Date?

The date on which a futures contract stops trading and is settled, either by cash payment or physical delivery, according to the contract's terms..

No. 15What Is Contract Size?

The standardized quantity or dollar multiplier of the underlying asset that one futures contract represents, set by the exchange for every trader..

No. 16What Is Contract Month?

The specific month and year in which a futures contract expires, each represented on the exchange by a standardized letter code..

No. 17What Is Rollover?

Closing a position in an expiring futures contract and opening an equivalent position in the next contract month to maintain continuous market exposure..

No. 18What Is Front Month?

The nearest active contract expiration month, which is typically the most heavily traded and most liquid version of a futures contract at any time..

No. 19What Is E-mini?

A smaller-sized version of a standard futures contract designed to make futures trading more accessible to individual traders with less capital..

No. 20What Is Micro Futures?

Futures contracts introduced by CME Group at one-tenth the size of the equivalent E-mini, making it easier for smaller accounts to trade index futures..

No. 21What Is Back Month?

Any futures contract month beyond the front month, generally used for longer-term positioning, hedging, or spread trades rather than active day trading..

Economic Events

No. 2What Is Consumer Price Index?

A government-published index measuring the average change in prices paid by consumers over time, watched closely by traders because it heavily influences Fed policy..

Frequently Asked Questions

What are the most important futures trading terms for a beginner?

Start with the contract mechanics: futures contract, tick, tick value, point value, initial margin, maintenance margin, day trading margin, leverage and notional value. Those nine decide how much a single move on the ES or MES costs you in real dollars. Everything else on this page builds on them.

How is this different from the Trading Glossary?

The Trading Glossary is one page with every term the room uses, in a sentence or two each. This series gives each term its own page with a short video in George's voice, a written lesson, an ES example, and questions traders ask about it.

How often is a new term published?

One new term goes live every weekday at 10:00 AM Central, in order from the most basic mechanics forward. The page for each term is created the moment its video is public.

Are the examples for the ES or the MES?

Both. Every example is given on the ES E-mini and, where the numbers differ, the MES micro as well, since most traders in the room start on the micro.