Hi, This might sound really stupid but please bear with me for a second. First,I don't trade futures and never have and might not for the next year or 3 or at all. I am a full time Forex trader and have a very basic idea about the futures market but am I not newbie when it comes to trading. The question is a strange one or long winded so please bear with me. Most Forex brokers offer Index CFDs. Some charge a overnight fees others might not charge fees if you keep you position open overnight,is this the same with futures brokers? Some of those Forex brokers say that it's a Index Futures CFD with an expiry date and/or a "Rollover" date. So my first question is , say I am long FTSE100 in the futures market and I am down 300 points in my position.Can I rollover that position to the next months contract? If yes,then does that incur a charge.Do I have to pay a fee to do that? If so what do I need to google to find the calculation for it please ? Secondly,if I can rollover the position to the next month when I am in a loss.Can I rollover the position indefinitely till it's in profit?( I know ETFs are better for this but only asking) This is just part of the question but if my understanding of the above is incorrect then no point in basing the rest of the question of something that is not correct. If you read this far thank you for your time and if you post a reply that you even more so! Rooi
If at a loss and you exit out of it, you show closed loss, no rolling out of it into next contract months. In days of old, if you didn't get out of a corn contract and was long, exchange be sending you documents of where to pick up your 5,000 bushels of corn, then the real lose come in to get rid of that of few thousands bucks unless you really wanted the corn. most brokers these days will be phoning you few days before certain date of contract or simple take you out. You should be getting daily confirmation of your status of open positions on the close of business and profits/losses should be there or contact broker and they will tell you. USA can't trade CFDs. I never heard of overnight fees, but margins go up in futures if kept overnight. ETFs don't rollover, in a way they trade like stocks.
Hi Handle, Thanks for getting back to me. But, If at a loss and you exit out of it, you show closed loss, So you must exit? no rolling out of it into next contract months. So what does rolling out mean please ? In days of old, if you didn't get out of a corn contract and was long, exchange be sending you documents of where to pick up your 5,000 bushels of corn, then the real lose come in to get rid of that of few thousands bucks unless you really wanted the corn. most brokers these days will be phoning you few days before certain date of contract or simple take you out. Only looking at stock indexes,what would happen if kept open? You should be getting daily confirmation of your status of open positions on the close of business and profits/losses should be there or contact broker and they will tell you. USA can't trade CFDs. I never heard of overnight fees, but margins go up in futures if kept overnight. ETFs don't rollover, in a way they trade like stocks. I see.Thanks for the info and help.Already a lot of great info. Rooi
There is no special rollover procedure in futures trading, traders simply close their positions in the nearest contract and open the same positions in the next one. Generally, the front month rollover in the Equities and Currencies occurs one week prior to expiration. The last trade date (LTD) for the U.S. Equities is on the business day preceding the third Friday of the contract month. Positions in expired contracts will be removed by Clearing House prior to the business date following the final settlement date for cash-settled contracts. The final settlement prices are received by the CME Clearing House on the third Friday of the contract month.
What Happens at Rollover if you have an Open Position? Answer is nothing. ---At settlement is a different story---