What is the Nasdaq NQ future,
in numbers that matter

What NQ actually is

A futures contract is an agreement to exchange something at a set price on a future date. For an index future, there is nothing physical to deliver, so it settles in cash against the index value.

The underlying index

The Nasdaq 100 tracks the hundred largest non financial companies on the Nasdaq exchange. It is heavily weighted towards large technology companies, which is why it moves more than the S and P 500 on the same news, and why it is the preferred intraday instrument for traders who want range.

Why traders use the future rather than an ETF

• It trades nearly around the clock, so the reaction to overnight news is visible before the stock market opens.
• Costs are transparent and per contract, not a percentage.
• It is symmetric. Going short is the same operation as going long, with no borrow and no restrictions.
• Leverage is built in, which is the advantage and the danger in the same sentence.

Contract months

The contract expires quarterly, in March, June, September and December. Traders roll to the next one a few days before expiry, when volume moves across. If your chart suddenly gaps for no reason, check whether you are looking at the expiring month.

The numbers: NQ and MNQ

There are two sizes of the same contract. Everything else about them is identical: same index, same hours, same behaviour.

NQ, the E-mini

The full sized contract. Each index point is worth 20 dollars. The minimum price increment, the tick, is 0.25 points, so one tick is 5 dollars. A twenty point move, which is nothing at the open, is 400 dollars per contract.

MNQ, the Micro E-mini

One tenth of the size. Each point is worth 2 dollars, and a tick is 50 cents. The same twenty point move is 40 dollars. This is the contract that makes it possible to learn futures without a five figure account.

The one that matters for sizing

Point value is the number you divide by. Your risk in dollars, divided by your stop in points, divided by point value, gives you contracts. On MNQ with a 20 dollar risk and a 10 point stop: 20 divided by 10 divided by 2 equals one contract. The risk guide works through the rest.

Tick, point and what a move costs

These three words get used interchangeably and they are not the same thing. Getting them straight removes a whole category of beginner mistakes.

A point is one index unit

If the Nasdaq 100 future goes from 20,150 to 20,151, that is one point. On MNQ it is 2 dollars. On NQ it is 20 dollars.

A tick is the smallest move price can make

Price does not move in whole points. It moves in increments of 0.25, so from 20,150.00 to 20,150.25. That quarter point is one tick, and it is the smallest possible change in your profit and loss.

Why the tick matters more than it looks

The spread, the gap between the best bid and the best offer, is usually one tick in liquid hours. That means every trade starts one tick down: you buy at the offer and could immediately only sell at the bid. On MNQ that is 50 cents, on NQ it is 5 dollars, and it happens on every single trade you take.

Putting it together

A 10 point stop on one MNQ contract risks 20 dollars plus costs. A typical daily range of 250 points is 500 dollars of movement on one micro contract. Those two numbers together tell you why sizing carelessly on this instrument goes wrong quickly.

Why the micro exists

The Micro E-mini contracts were introduced in 2019, and they changed who can realistically learn futures.

The problem they solved

Before them, the smallest Nasdaq future position moved 20 dollars per point. With a reasonable 15 point stop that is 300 dollars of risk on the minimum position, which requires an account of around 30,000 dollars to be risking one percent. That priced out essentially everyone learning.

What the micro changed

At 2 dollars a point, the same 15 point stop risks 30 dollars. Suddenly a 3,000 dollar account can trade one contract at sensible risk, and a learner can take a hundred trades without the size being absurd relative to the balance.

The trap that came with it

Because a micro feels small, people take ten of them. Ten MNQ is one NQ, with exactly the same risk and none of the psychological signal that ten contracts sounds like a lot. The number of contracts is not the risk. Points times point value times contracts is the risk.

The sensible use

Start with one. Increase only after a hundred trades at the current size that followed the rule. The learning plan puts this in month six for a reason: the micro removes the financial barrier to starting, not the behavioural one.

Margin, and why it is not the risk

This is where most people misunderstand futures, and the misunderstanding is expensive.

What margin is

Margin is a deposit the exchange requires to hold a position. It is not the cost of the contract and it is not what you can lose. The exchange sets a maintenance level and brokers set their own initial requirement, which is often higher.

Day trading margin is smaller and misleading

Many brokers advertise intraday margins far below the exchange requirement, sometimes a few hundred dollars for a full sized contract. That number is a credit decision by the broker, not a statement about risk. With 500 dollars of day margin, a 30 point adverse move on NQ is 600 dollars, which is more than the margin and all of it is yours to pay.

The number that matters

Your risk is your stop in points, times the point value, times contracts. Margin does not appear in that calculation anywhere. A trader who sizes by margin instead of by stop distance is effectively choosing position size at random.

Overnight is different

Intraday margin usually reverts to the full exchange requirement before the close. Holding a position through that transition without the balance to cover it triggers a liquidation, often at the worst available price.

Hours and when it moves

The contract trades close to twenty three hours a day, Sunday evening through Friday afternoon US Central time, with a short daily break. But trading hours and useful hours are not the same thing.

The overnight session

Thin volume, wider spreads, and price that drifts or reacts to Asian and European news. Moves can be real but liquidity is poor, so slippage is worse and a stop can fill several ticks away from where you put it.

The European overlap

From the London open the tape thickens. Still not where most of the day range happens, but tradeable and often where the overnight range gets defined.

The New York open

The US cash market opens at 9:30 New York time, and the first thirty minutes carry a disproportionate share of the day range and the volume. This is where the instrument earns its reputation, and where beginners get hurt, because a stop sized for midday gets taken instantly. The opening guide has the detail.

The macro calendar

Inflation prints, employment data and Federal Reserve announcements move this contract more than anything technical on the chart. The schedule is public and there is no excuse for being surprised by it.

What a round turn really costs

Adding up the actual cost of a trade is the exercise that changes how people trade, because the number is bigger than they assume.

The components

• Commission, charged by your broker per side or per round turn. On micros this commonly runs from about 50 cents to 1 dollar per side.
• Exchange and regulatory fees, a few cents per contract, usually bundled into what the broker quotes.
• The spread, one tick in liquid hours, which is 50 cents on MNQ and 5 dollars on NQ.
• Slippage, the difference between the price you wanted and the one you got. Small in the middle of the day and very much not small at 9:30.

The arithmetic that matters

Call it roughly 2 dollars of commission plus 50 cents of spread per MNQ round turn. That is 2.50 dollars, which is 1.25 points. A scalping style taking twenty trades a day pays 50 dollars before being right about anything. To break even it needs 25 points a day of pure edge.

Why this kills most high frequency beginner strategies

If your target is 4 points and your cost is 1.25 points, costs are consuming over 30 percent of a winning trade. The scalping guide covers why this is the defining constraint of short timeframe trading, and why simulators that charge nothing teach a style that cannot work.

Why beginners choose it, and the catch

NQ has become the default retail intraday instrument. The reasons are real and so is the downside.

The genuine advantages

• It moves. A 250 point daily range means opportunity exists without waiting days for it.
• Specifications are public. Point value, tick and hours come from the exchange, not from a broker marketing page.
• Shorting is trivial, with no borrow and no uptick considerations.
• The micro makes it affordable at a size where one percent risk is actually achievable.

The catch nobody mentions

The same volatility that creates opportunity punishes bad sizing faster than a slower instrument would. A 30 point adverse move happens in under a minute at the open and is routine. On five MNQ contracts that is 300 dollars, which on a 3,000 dollar account is ten percent in sixty seconds.

The honest recommendation

It is a reasonable instrument to learn on, at one micro contract, with a stop sized to current volatility rather than to a fixed number of points. It is a bad instrument to learn on at size, and it is unforgiving of the habit of adding to a losing position.

Frequently asked questions