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A wire ferrule is a copper plated tin tube that slides over the stripped end of a stranded wire. It is available in both insulated and non-insulated versions. The insulated wire ferrule contains a nylon extruded jacket intended to reduce signal leakage, creepage and reduce gas intrusion. The nylon jacks are color-coded by wire AWG (American Wire Gauge) or the Cross-Sectional Area of the conductor in millimeters squared (mm²). The color code will either follow the Industry Standard, which is commonly found throughout North America, or the DIN Standard (German Institute for Standardization) commonly found throughout Europe.
There are many benefits to using wire ferrules that far outweigh the minor cost per piece and additional labor and tools required to install them. Below is a list and explanation of the more common benefits, to help you make an educated and informed decision before using or omitting them.