Futures months and rollover - longer term view

[blink18]

Let's say you want to stay in a longer term position (1-2 years), and you have 12 contracts available for every future month, does it make sense to rollover monthly or just buy 6 months into the future and rollover two times per year?

 

[Overnight]

Let's say you want to stay in a longer term position (1-2 years), and you have 12 contracts available for every future month, does it make sense to rollover monthly or just buy 6 months into the future and rollover two times per year?

If you want to stay in a 1-2 year position, than just buy the position 1-2 years out. Jumping in and out each month will just incur unnecessary commish/fees.

 

[blink18]

If you want to stay in a 1-2 year position, than just buy the position 1-2 years out. Jumping in and out each month will just incur unnecessary commish/fees.

I have a strategy that can stay in a trade from one month up to 1-2 years. I'm looking for a sweet spot between liquidity, costs and rollover maintenance.

 

[heispark]

As far as I know, as a speculator futures is not ideal for long term investment due to roll-over cost......

 

[blink18]

As far as I know, as a speculator futures is not ideal for long term investment due to roll-over cost......

1-2 years is still OK for trading purposes, we're not talking about buy&hold for 10 years.

 

[R1234]

There is also the roll yield you need to think about. If whatever you are trading is in steep contango you will be losing yield each time you roll.

 

[Overnight]

1-2 years is still OK for trading purposes, we're not talking about buy&hold for 10 years.

It would probably help your audience if you mentioned which future you are speaking of. Since you posted this in the commod future section, we can assume you are not talking about stocks or bond or index futures.

 

[CannonTrading_Ilan]

Let's say you want to stay in a longer term position (1-2 years), and you have 12 contracts available for every future month, does it make sense to rollover monthly or just buy 6 months into the future and rollover two times per year?

Really depends which specific market for liquidity reasons as well as the fact that some markets back month will behave and have different price action than the front month.

 

[bone]

Why not get out of your losers and roll your winners ? What commodity?

I have a strategy that can stay in a trade from one month up to 1-2 years. I'm looking for a sweet spot between liquidity, costs and rollover maintenance.

 

[bone]

Poppycock. Look at other commodity investment vehicles like ETF's and the convenience yield is actually much worse.

As far as I know, as a speculator futures is not ideal for long term investment due to roll-over cost......