The CME 5 year Treasury note futures contract represents the stream of income from interest payments and then the payment of principal at note maturity on a $100,000 5-yr U.S Treasury note. 



Example of Futures Quote:

5-year T-notes are quoted in terms of $100 of face value. If the price is below 100, that means that buyers demand a higher rate of return than the coupon rate. If the price is above 100 is means that buyers are content with a lower rate of return than the coupon. If it is trading at 100, that means that it is trading at the coupon rate, which is called par.

Prices are quoted in 1/32nds of a point with one point equal to $1,000, and 1/32nd equal to $31.25.

123'07 means 123 and 7/32 points. If you buy the futures at 123'07 and it goes up to 124'07 that means that the contract gains one point or $1,000. If it goes from 123'07 to 123'08 that means that it gains 1/32 of a point or $31.25.

5-Year T-Note Options Quotes

The CME 5 year Treasury note options contract control $100,000 worth of US. Treasury notes based on the underlying futures contract. Strike prices are listed up and down from "at the money" at 1-point increments.

Example of Option Quote:

Prices are quoted in 1/64ths of a point with one point equal to $1,000, and 1/64th equal to $15.625.

1'42 means 1 point and 42/64ths

1.65625 X $1,000 = $1,656.25 (price of option)