Minimum price movement, also known as tick size, refers to the smallest increment by which a quote can change when trading a particular financial instrument or futures contract.

Exchanges set this parameter based on market conditions to standardize price precision.

For example, if a futures contract has a tick size of 0.01, its price can only move in increments of 0.01 (100.00 → 100.01 → 100.02, and so on). Non-standard prices like 100.005 are considered invalid.

The purpose of setting a minimum price movement is to standardize quoting practices, improve matching efficiency, and help maintain market order.