Understanding Position Equivalents
Positions are measured based on the type of contract:
- 1 Mini = 1 Position
- 1 Small = 1 Position
- 10 Micros = 1 Position
Each group of 10 micros is equivalent to one position, meaning 20 micros equal two positions, and so forth.
Examples of Allowed Position Combinations
Based on ETF’s position rules, here are combinations within allowed limits:
- Allowed: 1 mini, 1 small, and 10 micros (3 positions total)
- Allowed: 2 minis, 1 small (3 positions total)
- Allowed: 2 minis and 10 micros (3 positions total)
- Allowed: 2 smalls and 10 micros (3 positions total)
Each combination adheres to the example maximum of 3 total positions.
Examples of Exceeding Position Limits
To prevent exceeding your allowed positions, avoid these combinations:
- Not Allowed: 1 mini, 1 small, and 20 micros(20 micros equals 2 positions, resulting in 4 positions, one over the limit.)
- Not Allowed: 2 minis and 2 smalls(4 total positions, exceeding the limit of 3.)
- Not Allowed: 3 minis, 3 smalls, and 30 micros(This totals 9 positions, far over the allowed limit.)
Consequences of Exceeding Position Limits
Exceeding the maximum allowed positions has the following effects:
- Evaluation Accounts: Exceeding the limit results in an automatic evaluation failure.
- Elite Accounts: Going over the limit leads to a forfeit of profits and permanent account closure.
Understanding these position limits is crucial to maintaining compliance in ETF accounts. For further details, refer to ETF’s support resources.