Trading Micro futures contracts: Start small and build consistency

February 7th, 2024

Compounding leveraged instruments for account growth is a sound strategy for any futures trader. Trading Micro futures contracts is an effective starting point but requires consistency and patience to achieve your goals.

In the recent webinar “Automated Approaches for Day Trading,” Zoom in Profit Algo System’s John Santos explains how building consistency with Micro futures contracts and compounding them over time can lead to success. One Micro contract is the lowest common starting point that traders at any level can enter to best understand a basic unit, Santos said. For example:

  • One Micro contract comprises 1/10 of a mini contract
  • Start with $1,200 per Micro futures contract
  • Add one Micro contract for each $1,200 added to your account

Each month varies, so some months you may get 2-3x the average ($400-$600) in winnings, some you may get the basis of $200, and some you may lose. The consistency aspect of this strategy is challenging, but if you can stack $200 on average per month per Micro contract, then you can grow to $1,200 and add another Micro contract. Theoretically, it would take you about 10 months to earn enough to achieve one mini contract (10 Micro contracts).

This strategy is applicable to Nasdaq, E-mini S&P, Dow Jones, crude oil, and more. But for this example, Santos sticks exclusively to Nasdaq.

Algorithm strategies in trading Micro futures contracts

The challenge when trading Micro contracts is maintaining steady growth. Performance strategies over a long period of time can be challenging as always changing market conditions do not allow for steady growth in retail trading algorithms. What is a trader to do? Strategize.

 Here is a view of Santos’ ideal balanced strategies:

He delves deeper into GPT2K, or guide to target profit 2000 (no relation to ChatGPT). GPT2K is an applicable strategy for any trader who has a profit or earnings goal in mind and a plan to get them there for the year. Santos’ price action strategy is covered in depth in the full webinar.

Interested in more futures trading tips?

Enter Email for Updates