Jump to content
  • 0

Cost of rolling futures automatically vs. manually


Doggie52

Question

Hi,

I'm wondering how pricing works for rolling of futures and forwards. I tried searching for this but couldn't find anything that answered the question.

Firstly, do "roll" or "spread"-type orders exist on the IG platform? Can I execute a roll myself or am I forced to outright sell and then outright buy the next contract?

Secondly, say, hypothetically, I had two futures positions on your platform.

  • For one, I let it automatically roll me into the next month using the auto-roll.
  • For the other, I execute a roll myself (again, can I actually do this or will it be outright sell + outright buy?).

Which approach would lead to the lowest spreads and overall costs, assuming the two approaches are executed at the same time?

Thanks in advance for any help!

Link to comment

3 answers to this question

Recommended Posts

  • 0

Hi @Doggie52

Thank you for the query

We have automatic and manual rollovers. Automatic rollovers will rollover your positions automatically close to the expiry of the contract. This option can be enabled on My IG>Settings>Rollovers. You can find details on how this is done in the market info section on the platform. There are slight differences depending on the market. Please see the following example of how we treat indices:

image.png

Manual rollovers are done when you do not want to wait to expiry. You would then call in, a dealer would quote you a closing price for the current contract and an opening price for the following contract.

In all cases rollovers involve realising the profits/losses sustained in the previous contract before moving on to the new contract. Auto-rolling a position and outright buying and selling theoretically results in the same spread charges applied, with the exception being share forwards where we offer a concession on market spread. 

I hope this helps. All the best

Anda

 

Link to comment
  • 0
On 11/10/2021 at 16:01, AndaIG said:

Hi @Doggie52

Thank you for the query

We have automatic and manual rollovers. Automatic rollovers will rollover your positions automatically close to the expiry of the contract. This option can be enabled on My IG>Settings>Rollovers. You can find details on how this is done in the market info section on the platform. There are slight differences depending on the market. Please see the following example of how we treat indices:

image.png

Manual rollovers are done when you do not want to wait to expiry. You would then call in, a dealer would quote you a closing price for the current contract and an opening price for the following contract.

In all cases rollovers involve realising the profits/losses sustained in the previous contract before moving on to the new contract. Auto-rolling a position and outright buying and selling theoretically results in the same spread charges applied, with the exception being share forwards where we offer a concession on market spread. 

I hope this helps. All the best

Anda

 

Hi Anda,

I don't feel like this answers the question - is auto-rolling cheaper or same price as manual rolling, again assuming they are happening at the same time?

Also, what I'm getting from your answer is that manual rolling involves calling the desk and cannot be done online?

Best,

Douglas

Link to comment
  • 0

Hi @Doggie52

Its the same charge, the same spread is applied in both cases if they are happening at the same time. The only exception is shares as we offer a concession on market spread. Thus in this case only it would be more expensive to sell the previous contract and purchase the next online. Yes manual rollovers are done by our dealers but you can essentially do the same online. 

Thanks

Anda

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • General Statistics

    • Total Topics
      23,075
    • Total Posts
      95,531
    • Total Members
      43,696
    • Most Online
      7,522
      10/06/21 10:53

    Newest Member
    jimipop
    Joined 04/10/23 17:01
  • Posts

    • A lot of transformation is happening to BNB at the moment with the integration of bitcoin lightning network and Optimism especially with opBNB birth but that has not reflected in users confidence primarily because of the many negativities surrounding the platforms operations in North America and Australia. BGB on the other is gaining traction and value because a lot of investment is going into the development of the ecosystem recently with the injection of $100M and also improved partnership deals
    • I know we still have a lot to do to attract massive crypto adoption but steps like those taken by Binance and bitget in the wake of what happened to FTX is commendable in righting the wrongs of the lapses and loopholes that exist pre-FTX saga. But more still needs to be done to restore confidence to the level it was pre-2020 bear market like consistent regulatory framework and regular security updates by crypto platforms
    • Yeah, there's a 20 in a hundred chances for you to make that kind of ROI these though I'm not completely ruling it out because I'm one of the few that benefitted from PEPE rise to stardom amassing a return of 10x on bitget after it got listed on binance
×
×
  • Create New...
us