In this article we are going to learn how to determine which ES emini contract is currently active and live on the Globex electronic trading system and WHY it is important. Since index futures symbols change every three months at expiration, new traders can easily become confused and if not careful, find themselves holding a contract through expiration unintentionally. For those individuals using the ES futures as a vehicle for gaining short term profits, holding a position through expiration and settlement is not the desired outcome. So how do we know which contract is current?
S&P 500 ES emini futures contracts expire four times each calendar year or every three months. The months in which they expire never changes and are as follows: March, June, September and December. Initially, this can be very confusing for new individuals entering the futures markets but once the months are committed to memory, it becomes second nature and no longer a going concern. Each month has its own alpha or letter identifier. March is (H), June (M), September (U) and December is (Z).
These letters alone however do not really tell us the whole story since they are only used to identify the expiration month. We need to combine these letters with the current year in which the ES is being traded. For example, if the current trading month is July, 2012 we know the contract now on the Globex electronic system is set to expire in September since it rolled over the previous month of June. The year is added to the symbol and follows the month identifier, in this case the letter would be U followed by the number 12 since it is July, 2012 and we are trading the September 2012 ES contract.
There are several emini futures contracts which represent other index cash markets including the NASDAQ, Dow and Russell exchanges along with the S&P which we are outlining in this article. There must be a symbol which identifies the specific index that is represented by the futures contract, in the case the S&P 500. This index is identified on the Globex system by the letters ES followed by the current contract expiration month and year. So the current contract would be identified by the symbol ESU12.
- ES – S&P 500 Emini Futures Contract
- U – September Expiration
- 12 – Year of Expiration
The contract letter identifier never changes, only the month and year. Once we clearly understand and have committed to memory the expiration months, knowing which contract is currently trading is easily determined by the using the current month and year.