Tick Size & Tick Value
Also known as: tick size, tick value, minimum price increment, contract size
What is it?
Tick size is the smallest amount an instrument's price is allowed to move, and tick value is what that movement is worth in your account currency for one contract. The two are joined by the contract size, and the chain is short: contract size times tick size equals tick value. Take the E-mini S&P 500 - the contract is $50 per index point, the tick size is 0.25 of a point, so one tick is worth $12.50. Gold futures are 100 ounces with a 0.10 tick, giving $10.00 a tick.
| Instrument | Contract size x tick size | One tick is worth | 20 ticks against you |
|---|---|---|---|
| E-mini S&P 500 | $50 a point x 0.25 | $12.50 | $250.00 |
| Gold futures | 100 oz x $0.10 | $10.00 | $200.00 |
| EUR/USD, one standard lot | 100,000 units x 0.00001 | $1.00 | $20.00 |
Spot EUR/USD on a standard lot of 100,000 units moves in 0.00001 increments, so a tick is $1.00 and the more familiar pip - ten ticks - is $10.00. The same twenty ticks of adverse movement is therefore $250 on the E-mini, $200 on gold, and $20 on a standard-lot EUR/USD position. This is the arithmetic that converts a stop distance on a chart into money at risk, which is why it decides position size rather than merely describing the instrument. A trader moving from FX to index futures with the same lot habits is usually surprised by the first loss, because nothing about the chart signals that each tick is worth twelve times more.
Read the contract specification for tick size, tick value and contract size before the first trade in any new instrument, and compute the risk in currency, not in ticks. Your capital is at risk. See /risk-warning.
Why it matters: Tick value converts a stop distance into actual money, so the same twenty-tick stop can risk $20 on one instrument and $250 on another.
Tick value = contract size x tick size
It is the multiplier between chart distance and account risk, so getting it wrong misprices every position from the first trade onward.
Real-world example
Twenty ticks of adverse movement costs $250 on one E-mini S&P 500 contract, $200 on one gold futures contract, and $20 on a standard-lot EUR/USD position.
How SignalBots handles it
SignalBots publishes each signal's entry and stop as prices on a named instrument, so you can convert the distance to your own position size using that instrument's tick value before you commit. See /risk-warning.
Pro tip
Convert every stop into account currency before sizing - ticks are not comparable across instruments, and a stop that feels tight can be the largest risk in the account.
Common pitfalls
Carrying position sizes across instruments. One contract of an index future and one standard lot of a major pair are nothing alike in money terms, even at identical tick distances.
Frequently asked questions
Is a tick the same as a pip?
Not usually. On a five-decimal FX quote a tick is the fifth decimal and a pip is the fourth, so one pip equals ten ticks. In futures there is no pip - the tick is the only increment.
Where do I find an instrument's tick value?
In the contract specification your broker or exchange publishes for that symbol, alongside contract size and minimum increment. Platform symbol properties usually show the same three fields.
Does tick value change?
For instruments quoted in your account currency it is fixed. Where the instrument settles in a different currency, the value in your account moves with the exchange rate, so it varies slightly over time.
How does tick value set position size?
Divide the money you are willing to risk by the stop distance in ticks multiplied by the tick value. That gives the number of contracts or lots the trade supports.
Why do some instruments have odd tick sizes?
Exchanges set the increment to balance a tight spread against a manageable number of price levels. The E-mini's 0.25-point tick exists for that reason, which is why it does not move in whole points. Your capital is at risk.
Trading involves substantial risk of loss. Historical and backtested results do not guarantee future performance. Read the full risk warning.
