E-mini day trading is intraday trading of equity index futures to profit from daily price moves. E-mini futures are equity index based futures traded on the Chicago Mercantile Exchange. Most day traders utilize technical analysis and major news events to time buys and sells. Utilizing futures contracts gives a day trader high leverage capabilities to capitalize on market moves with a single trade.

How E-mini Futures Work

E-mini futures are based off of the most popular broad based indexes in the financial world. There are four e-mini contracts that are available for trade. The E-mini S&P 500 tracks the S&P 500 index. The E-mini NASDAQ 100 follows the NASDAQ 100, an index of the 100 largest non financial companies on the NASDAQ market. E-mini Russell 2000 tracks the small cap index Russell 2000. The final contract is the E-mini S&P 400 a contract following the mid cap S&P 400.

Stock index futures are contracts to buy or sell the cash value of a selected index at a guaranteed price on a specific date. Mutual Fund and Pension managers use E-minis to protect their portfolios from negative price swings in the market. Individuals utilize E-minis futures to profit from the daily price moves in the stock market.

Since each E-mini contract is valued differently it would be prudent to understand how the values are calculated. The S&P 500 contract is valued by multiplying the index value by 50 dollars. If the S&P 500 contract is trading at 1000 the total value of the contract would be $50,000. The NASDAQ 100 multiplier is 20 dollars, the Russell 2000 multiplier is 100 dollars and the S&P 400 is 100 dollars. A trader can buy a 50,000 dollar contract with just 5 percent, or 2,500 dollars. The extreme leverage allows for increased profit and loss potential.