If you are used to trading stocks, you are probably chasing "home runs." You want Apple to go from $150 to $200. You are looking for big, sweeping percentage moves.
If the price of a stock moves just 10 cents, you probably wouldn't even notice. You'd yawn and close your app.
But in the Futures market, a 10-cent move isn't "noise." It's a massive opportunity.
The Boring Dime vs. The $100 Win
In our app's educational stories, we show two traders looking at the exact same chart of Crude Oil.
The price of oil moves up from $75.00 to $75.10.
The Stock Trader rolls his eyes: "Oil went up $0.10. I made a dime. Boring."
The Futures Trader is high-fiving the air: "Boring? I just made $100.00!"
The Stock Trader is confused: "What?! It is the same chart! How did you make 1,000 times more money than me?"
The answer is The Multiplier.
The Vocabulary of Profit: What is a "Tick"?
Futures don't just trade in dollars and cents. They trade in Ticks.
A Tick is the minimum amount a price can move up or down.
- In the stock market, the minimum move is usually 1 penny ($0.01).
- In the Futures market, that minimum move is assigned a specific Cash Value.
The Crude Oil Example
Let's look at the math from our story:
- The Market: Crude Oil (/CL)
- The Tick Size: $0.01 (One penny)
- The Tick Value: $10.00
This means for every single penny the price of oil moves, your account moves by $10.00.
- If Oil moves 1 cent ($0.01)=You make $10
- If Oil moves 10 cents ($0.10)=You make $100
- If Oil moves 1 dollar ($1.00)=You make $1,000
Why This Matters
This system changes how you view the market. You stop looking for "doubling your money" on a lucky stock pick. Instead, you start looking for highly liquid markets that move just enough to capture 10 or 20 ticks a day.
It turns trading into a game of precision, not just a game of luck.
Pop Quiz
If Crude Oil moves from $70.00 to $70.10 (a 10-cent move), and each tick is worth $10, what is your profit on 1 contract?
💡 Hint: Calculate: (price change ÷ tick size) × tick value × contracts
Practice: Understanding Tick Values
Crude Oil moves up 10 cents: $70.00 → $70.10
That's 10 ticks! 10 × $10 = $100 profit per contract. Small moves, big impact!
💡 Key Concept:
In Crude Oil, each tick ($0.01) is worth $10 because the contract size is 1000 barrels. A 10-cent move = 10 ticks = $100 profit/loss.
Test Your Math
Understanding ticks is the first step to thinking like a professional. If you don't know the Tick Value of the market you are watching, you are flying blind.
MarketDues features interactive quizzes and stories that help you memorize these values for Gold, Oil, and the S&P 500. Don't risk your money until you know exactly what a "penny" is worth.
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