What is a 'Contract Size'
A contract size is the deliverable quantity of commodities or financial instruments underlying futures and option contracts that are traded on an exchange. The contract size is standardized for such futures and options contracts, and varies depending on the commodity or instrument that is traded. The contract size also determines the dollar value of a unit move in the underlying commodity or instrument.
BREAKING DOWN 'Contract Size'
The contract size of most equity option contracts is 100 shares. However, the contract size for commodities and financial instruments such as currencies and interest rate futures varies widely. For example, the contract size for a Canadian dollar futures contract is C$100,000, while the size of a soybean contract traded on the Chicago Board of Trade is 5,000 bushels.
The size of a gold futures contract on the COMEX is 100 ounces. Therefore, each $1 move in the price of gold translates into a $100 change in the value of the gold futures contract.