Futures Rollover Technique

T

torontoman

In June I have 8 ES contracts to rollover. I may not be near a computer at rollover day due to my son's graduation, so I have another plan. Please tell me if this is a stupid idea and why.

I put in an order to buy the September contracts before the rollover date (ie now) under the current bid. If it hits, I sell the June contracts at market immediately after.

Is this stupid and if so, why?

Thank you.
 
Why don't you make life easy and just ROLL over prior to expiration?

It does not matter when you do it. Both JUN, and SEP are liquid close to expiration. Both contracts trade in tandem so you are not going to save more than a tick, maybe, by bidding/offering.

This way you don't have anything on your mind at the kid's graduation except being a proud pop.
 
Thanks for the response El Pollo? My buddies are saying to wait for June 11, but I still don't understand why I should wait when I could do it now. Why does everyone do it on rollover day?
 
Everyone does not rollover on rollover day. There will be plenty of liquidity in the JUNE ES on the Friday and Monday after rollover day. It is best to roll when there is good liquidity in both contracts.
 
If you plan on holding it for a long time, you can rollover whenever, the spread (jun/sep) market is currently -455/-450 1000x350, so I think you would be safe rolling now. (and thats in the aftermarket)

You would not want to roll if you have a close stop or plan on scalping, but if you are just holding on to it there is no reason to wait.
 
Quote from torontoman:

Thanks for the response El Pollo? My buddies are saying to wait for June 11, but I still don't understand why I should wait when I could do it now. Why does everyone do it on rollover day?
More...

Fuck your buddies.
Just do it when it suits your needs.
 
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