What Is To Roll Forward A Futures Position?
Rolling forward, also known as Roll Over, is one of three actions futures traders take to close out their existing futures position. The other actions being to “Offset” and “Reverse”. When you roll forward a futures position, you are closing off a near term, possibly expiring futures position, and simultaneously opening the same number of contracts in a further expiration month. This is like extending the expiration of your existing futures position by rolling it on to a further expiration month in order to stay invested in the same direction for a longer period of time. For instance, if you own 1 contract of S&P500 E-Mini futures expiring in September and there is only a few more days left to September expiration. You decided to roll the position forward to the December expiration, so you go to your futures trading account and select to “Roll Forward” your existing position to December expiration. At the end of the rolling forward procedure, you are left with 1 contract of S&P500 E-Mi
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