Investing & Day Trading Education:  Day Trading Academy

What Are Emini Futures? Facts & History About Eminis

The Emini is now the largest and most important trading vehicle in the world.  There are millions of traders around the world that have abandoned their old school tactics like trading regular stocks and even the large scale Eminis.  Each Emini contract follows a major index and the most popular of all the Eminis is the Emini S&P 500 (symbol is ES).

When Did Emini’s Get Started?

The Emini S&P 500 was the first contract to be introduced by the Chicago Mercantile Exchange (CME) on September 9th, 1997 in order to get more people involved in futures trading.  The Emini S&P 500 futures contract was created at 1/5 the size regular contract that was valued at $500,000 at the time.

Later, the S&P 500 futures contract was split 2:1 valuing it at $250,000.  Emini contracts are now the largest trading vehicle in the world with a volume of over $100 billion.

Stock Market Volume

Margin Requirements for Eminis

Emini margin requirements have been slashed in recent years to as low as $400 to $500 per contract to trade during normal market hours and $2,000 for overnight positions.  Due to the economic crisis in 2008 and the current ongoing economic collapse, margins have been increased recently.

Why Should you Trade Emini Futures?

  • Tax reporting requirements are not extensive
  • Extremely low margins
  • You could trade at any time of the day anywhere in the world (Globex)
  • Very high liquidity allowing you to trade as many contracts as possible
  • No Short Selling requirements (lots of restrictions in the stock market)
  • Commissions are very low with Emini brokers
  • Special Tax Rules for US Traders (see taxes for day traders post)

I have been trading futures for almost 10 years now and I consider Emini futures to be the very best for anyone who wants to start day trading.  Of all the Eminis that I have traded, I consider the Emini S&P 500 to be the best.  I trade the Emini S&P 500 and crude oil futures exclusively.

Emini Futures vs regular Large S&P Futures Contract

E-mini S&P 500 (ES)

The ES is one of the most popular E-mini futures contracts in the world today.  A combination of great volume and fluid movement has made it one of the cornerstones of E-mini futures trading.  We choose to trade the ES for the following reasons:

  • Great volume
  • Easy to learn & trade on
  • Hardly any erratic movement
  • Great for beginners

The ES has 4 ticks to every point and is worth $12.50 per tick, or $50 per point.  So if you buy a contract at $800 and sell it at $801 that is a profit of $50.  Simultaneously, if you buy a contract at $800 and sell it at $800.75 our profit will be $37.50 (3 ticks at $12.5 each).