Point
A point is one full unit of price movement in a futures contract. For index futures like ES and NQ, one point equals four ticks. The dollar value of a point is the foundation for calculating P&L and position size.
A point is one full index point (or one dollar, one unit: depending on the instrument) of price movement in a futures contract. For equity index futures, one point equals four ticks.
Points vs ticks
| Instrument | Ticks per point | Point value |
|---|---|---|
| ES | 4 (0.25 tick size) | $50.00 |
| MES | 4 (0.25 tick size) | $5.00 |
| NQ | 4 (0.25 tick size) | $20.00 |
| MNQ | 4 (0.25 tick size) | $2.00 |
So on ES, a 10-point move = 40 ticks = $500 per contract.
Why the distinction matters
Traders talk in points, but your P&L is calculated in ticks. When you say “I made 3 points on ES,” you mean 12 ticks, or $150 per contract. Understanding the relationship prevents miscalculating risk.
Stop loss in ticks = stop distance in points × 4 (for index futures with 0.25 tick size)
Points and R calculation
If your risk on a trade is a 4-point stop on ES ($200/contract) and your target is 8 points ($400/contract), your R:R is 2:1. Thinking in points is faster for mental math at the desk: just always know the dollar conversion behind it.