Initial Margin
The minimum deposit required to open one futures contract, set by the exchange clearing house (CME, CBOT, NYMEX).
Leverage = Notional Value / Initial Margin
Initial margin is the good-faith deposit required before entering a futures position. It is set by the clearinghouse — not the broker — based on the historical volatility of the contract and is updated periodically (usually during expiry week or after large market moves).
Initial margin is not a fee or down-payment; it is collateral held against potential adverse moves. Funds remain in the trader's account and earn interest in some structures.
Brokers may require more than the exchange minimum — especially overnight — but never less. Intraday (day-trading) margin is a separate, lower figure offered by retail brokers for positions closed before settlement.
On the desk
CME sets ES initial margin at ~$15,840 per contract. At a notional of $270,000, that's roughly 5.9% of exposure. A trader with a $50,000 account can hold 3 contracts at the standard rate (3 × $15,840 = $47,520) while retaining some buffer.