Dear Valued Client,
Please be advised that CL-OIL futures has been rolled to the new contract on Friday 17th April 2020.
What is futures contract rollover and rollover adjustment?
We automatically rollover a futures contract at expiration. All open positions and orders are automatically rolled to the next futures contract. In order to nullify the impact on the valuation of the open position, given the change in the underlying instrument’s value for the new contract period, a debit or credit adjustment is made to the account.
If you do not wish for your position(s) to be rolled over, you may choose to close your position prior to the rollover date.
Will I suffer any loss as a result of futures rollover?
The price discrepancy between the two contracts does not affect the value of your open position as the changes in values of the open positions, are offset by a debit or credit adjustment made to the account. It appears on your statement as ‘Cash Adjustment-Future Roll’.
Note: your position will be closed if the price of the new contract reaches the stop loss or the take profit you set up for the order.
One standard contract size for CL-OIL is 1,000 barrels.
The CL-OIL rollover adjustments are -$6376 USD per lot for long position and +$6284 USD per lot for short position (in April 2020).
If you hold one lot of long CL-OIL, you will be charged -$6376. The ‘Cash Adjustment- Rollover’ is (debit) -$6376
If you hold one lot of short CL-OIL, you will be credited $6284. The ‘Cash Adjustment- Rollover’ is (credit) +$6284
If you hold one lot of long CL-OIL and one lot of short CL-OIL, you are fully hedged. You will be charged -$6376*1+$6284*1= -$92. The ‘Cash Adjustment- Rollover’ is (debit) -92
We recommend that you monitor positions carefully and maintain a sufficient account surplus throughout this period.
Please evaluate and trade cautiously during this volatile period.
If you have any queries, feel free to contact us on the details below.