Understanding Futures Expiration & Contract Roll
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- Опубліковано 25 сер 2024
- Learn about the expiration and rollover of futures contract and what your choices are when the lifespan of a contract comes to an end.
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What a incredible, beautiful and wonderful system..
To make you fool
Oh so that's why when in contango you'll lose money if you rollover because you'll have to pay more for the new contract
good video
My question is to avoid high rollover adjustment do you have to have the same amount of short and long positions to offset?
If you contract is in the negative, does that make the roll cost more?
I just took physical delivery of 10 Million oranges.... the dump truck just showed up 🤣 (jokes)
Currently I have an open position on a future contract that has an automatic rollover date that approaches and I don't know what to do. I would want to keep my position but I don't know what happens to my account after the rollover adjustment is made. If the price goes up after adjustment I lose money, if the price goes down I gain - is that correct? Pls answer.
What is a Rollover?
A rollover is the process of keeping a position open beyond its expiry. Whenever a futures contract reaches its expiration date, all open positions and orders are automatically rolled over to the next contract.
How will it affect my open positions?
To negate the impact of the new futures contract having a different price to the previous one, a rollover adjustment is made to the open position. The value of the positions continues to be the same, keeping the original opening price & trade quantity. If the new contract is traded at a higher price, BUY positions will receive a negative adjustment while SELL positions will receive a positive one and vice-versa if the instrument is traded at a lower price.
In essence, the difference in price between the current and next futures contract will be added or subtracted to nullify the impact on the open position's result.
Will Take profit & Stop loss orders also be rolled over?
Take profit & Stop loss orders are also adjusted to reflect the price of the instrument in the new contract.
Will entry pending orders be rolled over?
To avoid discrepancies with current criteria, entry pending orders will automatically terminate before the rollover.
@@ghitaciprian So if I rollover the contract will I keep my same relative price from when I opened the position? Or will I have to buy or sell the new contract at the current market price? I want to hold my position long term and not have to sell out. Is this possible?
@@spoonman73 defenitely you can leave it for long term without being affected by the rollover contracts.
If NOT rolled then expires.
Very poor example to explain offsetting. If i buy two more contracts then there is total 4 burden on me before expiration, how it offsets.
WHAT????? IN ENGLISH PLEASE