Gold Futures Explained: GC, MGC and What Each Move Is Worth

Key takeaways

Gold quotes are prices per troy ounce. One GC represents 100 ounces, one MGC 10 ounces and one 1OZ one ounce. A $1-per-ounce move changes their values by $100, $10 and $1 respectively, before costs.

Ordinary ticks are $0.10 per ounce for GC and MGC, worth $10 and $1 per contract. The 1OZ tick is $0.25 per ounce, worth $0.25 per contract. Check the price step as well as its dollar value.

Quantity can rebuild exposure: ten MGC or one hundred 1OZ have the same 100-ounce multiplier exposure as one GC. This does not promise identical fills, costs or settlement. Notional value, margin and planned loss describe different things.

GC and MGC are physically deliverable; 1OZ is cash settled. Their last-trade calendars differ, and delivery or provider deadlines can require earlier action. A planned stop does not guarantee an exact exit price or loss.

Full transcript

Gold up ten dollars: what does it mean?

Gold is up ten dollars. That sounds like a simple price change. But if you trade Gold futures, does it mean ten dollars in your account?

For one standard Gold contract, a ten-dollar move per ounce represents one thousand dollars before costs. For one Micro Gold contract, it represents one hundred dollars. For one 1-Ounce Gold contract, it represents ten dollars.

The market name is the same. The exposure behind the position is not.

In this lesson, we'll explain Gold futures: what the quote measures, how GC compares with its smaller alternatives, and why delivery and expiration deserve a separate check.

All prices and trades in our examples are invented. Unless stated otherwise, the calculations leave out costs.

A physical commodity and a price per ounce

Gold futures are contracts connected to a physical commodity. You're not trading a stock index or receiving shares of a mining company.

The contracts we'll discuss quote gold in U.S. dollars and cents per troy ounce. A troy ounce is a unit used to measure precious metals. Keep that unit attached to the price.

A quote of three thousand means three thousand dollars per troy ounce. It does not mean that the entire futures contract is worth three thousand dollars.

The contract's size tells you how many ounces that quote represents. Price per ounce and dollars per contract are different measurements.

Identify the actual futures product

We'll focus on three COMEX products: standard Gold futures, symbol GC; Micro Gold, symbol MGC; and 1-Ounce Gold, symbol one O Z. That last symbol starts with the digit one, followed by the letters O and Z.

These aren't the only ways to trade gold. A product sharing the word gold can have different specifications. Confirm the actual contract rather than transferring a number from a spot quote, an exchange-traded fund or another futures product.

GC: contract size and dollars per move

One GC contract represents one hundred troy ounces. A one-dollar change per ounce therefore changes the value of one contract by one hundred dollars.

When a trader calls that a one-point move, the calculation still needs its unit: one dollar per ounce, multiplied by one hundred ounces.

Long and short trade examples

Suppose you buy one GC at three thousand and sell it at three thousand and ten.

The price rose ten dollars per ounce. Ten times one hundred gives a one-thousand-dollar gross gain.

If you instead sell at twenty-nine hundred and ninety, the same-sized decline creates a one-thousand-dollar gross loss for that long position.

For a short position, the direction reverses. Sell one GC at three thousand and buy it back ten dollars lower, and the gross gain is one thousand dollars.

Use the actual entry and exit prices for the futures contract you traded. A spot-gold quote or another expiration's price is not a substitute for your fills.

Ticks versus dollars per ounce

An ordinary GC quote moves in increments of ten cents per ounce. From three thousand point zero, the next higher prices are three thousand point one, point two and point three.

Each step is one tick. Ten ticks make a one-dollar move per ounce. Multiply ten cents by one hundred ounces, and one GC tick is worth ten dollars.

Twenty ticks are a two-dollar move per ounce, worth two hundred dollars for one GC. A twenty-dollar move per ounce is two hundred ticks, worth two thousand dollars.

Saying twenty without saying ticks or dollars leaves room for a tenfold mistake.

MGC: Micro Gold

Micro Gold uses the symbol MGC and represents ten troy ounces. That's one tenth of the standard contract's size.

A one-dollar move per ounce is worth ten dollars for one MGC. Its ordinary tick is also ten cents per ounce, worth one dollar per contract.

The same ten-dollar favorable move produces one hundred dollars before costs in one MGC, compared with one thousand dollars in one GC.

1OZ: one ounce and a different tick increment

The 1-Ounce Gold contract represents one troy ounce. A one-dollar change per ounce is worth one dollar for one contract.

Its ordinary tick is twenty-five cents per ounce, worth twenty-five cents per contract. From three thousand, the next higher prices are three thousand and twenty-five cents, three thousand and fifty cents, then three thousand and seventy-five cents.

Four of those ticks make a one-dollar price change. A ten-dollar move is forty ticks and represents ten dollars for one contract before costs.

The smaller contract does not have the same tick increment as GC and MGC. Check both the price step and what that step is worth.

Also check availability. Your broker or account provider may not offer every product or permit the same positions in each one.

Quantity can rebuild exposure

Quantity can rebuild the exposure you reduced by choosing a smaller contract.

Ten MGC contracts represent one hundred ounces. So do one hundred 1-Ounce Gold contracts. Each position has the same one-hundred-dollar change for a one-dollar move per ounce as one GC.

That is a comparison of multiplier exposure. It does not promise identical quotes, fills, fees or trading activity. Replacing one larger contract with many smaller contracts makes per-contract charges especially relevant.

Notional value, margin and planned distance

At an invented price of three thousand dollars per ounce, one GC has a notional value of three hundred thousand dollars. Price per ounce multiplied by one hundred ounces gives the scale of the position.

One MGC has thirty thousand dollars of notional value. One 1-Ounce Gold contract has three thousand dollars.

Notional value is not the margin required to open the position. Margin supports the position's obligations. It is not a purchase price for a gold bar or a guaranteed maximum loss.

Exchange requirements and additional broker or account rules can change. A smaller amount required to enter does not reduce the contract's dollars per move.

Suppose an invented long trade has a planned stop eight dollars per ounce below entry.

That distance represents eight hundred dollars for one GC, eighty dollars for one MGC, or eight dollars for one 1-Ounce Gold contract, before costs and any difference in the actual exit.

Use ten MGC contracts, and the same planned distance represents eight hundred dollars again.

A stop does not guarantee that loss amount. Fast movement, unavailable liquidity or a trading interruption can prevent an exit at the intended price.

Physical delivery and cash settlement

Now separate the price calculation from what happens near delivery and expiration.

GC and MGC are physically deliverable contracts. They do not work like the cash-settled stock-index futures covered earlier in this series.

Micro Gold's delivery process uses an exchange certificate mechanism connected to a share of a larger gold bar. The ten-ounce trading unit is not a promise that a ten-ounce bar will arrive at your door.

The 1-Ounce Gold contract is cash settled instead. Its settlement is linked to the corresponding standard Gold futures contract under the exchange's rules. It does not deliver a one-ounce coin.

Daily settlement and final settlement are also different ideas. A daily settlement value does not, by itself, mean that your position has expired or its delivery obligations have disappeared.

Contract calendars, provider deadlines and rolling

Before entering, identify the product, contract month and year. Then check its current calendar, delivery or settlement procedure, and your provider's earlier position deadlines.

For GC and MGC, trading normally ends on the third-last business day of the contract month. But delivery can begin before that last trading day. Do not treat the last trading date as the only deadline that matters.

For 1-Ounce Gold, trading ends on the third-last business day of the month before the contract month. A shared month label does not mean these products stop trading together.

If your account does not permit delivery, follow its close-out or rollover requirements before the applicable cutoff. Check those rules before opening the position, not when the deadline is approaching.

Rolling means closing one expiration and opening another. Those are actual transactions, with prices and costs. A continuous chart does not automatically move your existing position to a later contract.

Trading schedules, quotes and execution

Trading schedules and access can differ across products and providers. Check current hours, maintenance windows, holidays and account restrictions for the specific contract.

Verify whether quotes are live or delayed. Look at the bid, ask and available quantity rather than assuming the chart's last price is available for your order.

Special price fluctuation limits and trading interruptions can affect execution. Knowing the dollar value of a move does not guarantee that you can enter or exit when you want.

Before the order: mechanics and evidence

Before an order, confirm the contract and expiration, the price unit, ounces per contract, tick size and tick value. Include quantity and costs.

Work through a favorable and an unfavorable move. Check required funds, execution conditions and the dates that apply to delivery or cash settlement.

A ten-dollar gold move is a price change per ounce. Your contract size and quantity determine what it means for the position.

Knowing those mechanics doesn't prove a strategy works. It gives you a clearer measurement before you decide how much confidence the trade deserves.

Next: Crude Oil Futures

Move from troy ounces to barrels. Compare CL, MCL and QM, their different price steps, dollar exposure and settlement obligations.