Basic Rollover Question

Discussion in 'Commodity Futures' started by Soon2Bgreat, May 2, 2007.

  1. Ok, this is extremely basic, hoping someone can help me out here.

    Say i have an unrealized loss/gain on my futures position and expiration day comes. I want to roll it over and keep a position into the next month as i expect the price to reach my target.

    To roll it over, do i close out the current month...and turn the unrealized loss/gain into a realized loss/gain and simply enter into the back month....or is my unrealized loss/gain carried over into the back month.

    If the unrealized loss/gain becomes realized, imo isn't that like 2 trades, doesn't much seem like 1 continuous trade if you close it and take your profit/loss, no?

  2. Surdo


    Close out the expiring position and open the new "FRONT" month.
    Treat it as 2 seperate trades, if it makes you feel better, add/subtract the P & L of the old position.

    If you don't like "rolling" your positions, then trade ETF's.

    good trading!

    el surdo
  3. Ok...that's what i thought, so 'rolling' a position is a euphemism for:

    ''i took a loss, but won't admit to it because i'm opening this new position that will hopefully make up for the last loss and make me some money''

    I could get good at 'rolling,' lol.:p

  4. Surdo


    Believe it or not folks do "close" positions with a gain and open a new one with the front month dope. Ever hear of hedging using futures?

    Do you "Roll" positions in a Paper Trading account?

  5. Unpossible...close with a gain?:p

    I was only half serious with my euphemism, i'm generally aware of the various uses for futures.

    I appreciate your concern over how i roll (starting to really like this term), and all i'll say is that i'm well aware of the possible risks of trading.

    Thanks again
  6. Long term trend followers might rollover a futures contract position a few days before expiration. Unrealized losses are acceptable as long as they are within risk budget and a trade exit signal is not generated by the trading rules.


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    is not always a game.
  7. Your broker really should be your info source here.

    Odds are, its in the fine print somewhere, its also true you can roll a contract anytime really, there are some opportunities (for profit) occasionally-but its your brokers job to not lead you down the garden path, in risk terms at least.

    There the guys with your money, there the guys who yah or nay your orders, listen to them.