Are Micro E-Mini Futures 'the Next Big Thing'?

Hedging Your Portfolio for Less

What Are Micro E-Mini Futures?

The CME Group launched micro e-mini contracts for four major indices on May 6, 2019. These contracts allow market participants to gain exposure to price fluctuations in the S&P 500, Russell 2000, Dow Jones 30 and Nasdaq100 indices at a much lower cost than the existing e-mini futures. Depending on which broker you use, you can go long or short markets like the S&P500 and Nasdaq100 with as little as $25 of day-trading margin per contract, offering an effective way to hedge your overall portfolio.

Right out of the gate, these contracts proved extremely popular. The micro e-mini S&P 500 futures hit a volume of almost 417,000 contracts traded on June 3, 2019. These micro contract volumes are approximately 25 percent of the volume of their much more established e-mini cousins. The contracts trade from Sunday 5 PM central time through Friday 4 PM central time for almost 24 hours a day.

How Do Micro E-Mini Futures Work?

E-minis were launched in the late 1990s when the values of the major indices got too large for the average trader. Index futures are futures contracts that allow investors to buy or sell a financial index today to be settled at a date in the future. The micro e-mini contracts are 1/10 the size of previous e-mini contracts, reducing the cost of the trade to 1/10th the cost of e-minis.

The S&P 500 and Russell 2000 e-minis are priced at $50 times the value of the index when the contract expires while the micro e-mini for those two are just $5 times the value. The micro e-mini contract for the Nasdaq 100 index is $2 times the index value, and the Dow Jones 30 micro e-mini is $0.50 times the index value. So if the S&P 500 index is 2950, the micro e-mini value is $14,750 versus the e-mini which would be priced at $147,500.

The micro e-mini S&P 500 index futures are designed to manage exposure to the 500 U.S. large-cap stocks tracked by the S&P 500 index. The micro e-mini Russell 2000 index futures offer exposure to the 2,000 small-cap stocks in the Russell 3000 universe of stocks. You’ll get exposure to the 30 bluechip stocks in the Dow Jones Industrial Average with the micro e-mini Dow Jones Industrial Average futures, and to the 100 leading non-financial U.S. large-cap stocks in the Nasdaq 100 with the micro e-mini Nasdaq 100 futures.

Micro E-mini futures will be listed on the customary U.S. Equity Index futures cycle with five concurrent futures that expire against the opening index value on the third Friday of March, June, September, and December, except for the Dow micro e-mini future, which will list four months. The CME has not yet announced whether they will enable options on the micro e-mini futures. 

Here is a partial list of brokers that have enabled micro e-mini trading.

Partial List of Brokers Who Have Enabled Micro E-mini Futures Contracts
Broker Name Website Commission per Contract Our Review
E*TRADE $1.50 E*TRADE Review
Interactive Brokers $0.32-0.47, depending on monthly volume Interactive Brokers Review
Ninja Trader $0.09-$0.29, depending on platform license subscription Not yet published
Tastyworks $0.85 Tastyworks Review
TD Ameritrade $2.25 TD Ameritrade Review 
TradeStation  $0.50 TradeStation Review 

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  2. AMP Global. "Reasons CME Micro E-Mini Futures Are the King for Futures Trading." Accessed May 8, 2020.

  3. CME Group. "Micro E-mini Futures Products Overview." Accessed May 8, 2020.

  4. CME Group. "Frequently Asked Questions: Micro E-mini Equity Index Futures." Accessed May 8, 2020.