What does Tick mean?
A tick is the smallest permitted price movement for a futures contract. Different contracts can have different tick sizes, so one tick does not represent the same price movement or dollar value in every market.
Why it matters
- Order prices must conform to the contract's permitted price increment.
- Stops, targets and slippage are often described in ticks.
- Tick size combines with the contract multiplier to determine tick value.
How it works
- 01
Each futures contract specification defines a minimum price fluctuation.
- 02
For NQ and MNQ, the minimum price increment is 0.25 index points.
- 03
Four 0.25-point ticks equal one full index point.
Example
If NQ trades from 20,000.00 to 20,000.25, the market has moved one tick.
Common misunderstandings
- Tick size and tick value are different concepts.
- One tick is not always one dollar.
- Different futures contracts use different minimum price increments.
Educational reference
This glossary explains terminology and
general market concepts. It is not a
trading signal or a guarantee of future
results.