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Futures Contracts Question


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Hey guys,

 

Someone with more experience trading futures for a while could answer this for me.

 

I am getting confused by the futures contracts expirations and "birth" dates.

 

For example the SP futures have 4 contracts per year correct, quarterly contracts that expires every 3 months.

 

SP contracts are H (march), M (june), U (september) and Z (december).

 

My doubt is, when we are in March, are we in fact starting to trade the M (june contract), and the H (march contract) is expiring. Is that it? The March contract had started trading in december?

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Look at the volume. When the volume in the front month is less than the volume in the next month, that is when the rollover is complete and it's time to change contracts. For example look at the volume for Crude Oil on the CME (CL). On Thursday Feb 14th, the March contract still had more volume but on Friday Feb 15th, the April contract has more volume. Time to trade the April contract. The April contract had more volume at the beginning of the session on Friday so from Friday you should have been trading the April contract. You only need to compare the volume between front month and next month near the rollover dates:

 

https://www.cmegroup.com/trading/equity-index/rolldates.html

 

https://www.investopedia.com/university/how-to-trade-e-mini-futures-contracts/beginners-guide-emini-futures-rollover-dates-and-expiration.asp

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Hey guys, thanks for your answers.

 

The rollover bit and expiration, delivery, I get it, what I was having a hard time to figure out was when the contracts started trading.

 

Yeah I usually use continuous contracts, but I wanted to start doing spread analysis, comparing contracts with different expiration dates to see if the prices are at premium or discount. So I wanted to know when they started trading. Oh well, how come I didn't think of opening a chart of the contracts and going back in time is beyond me, I guess I was used watching the continuous contract.

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Hi logicgate,

 

S&P e-minis expire on Thursday prior to third Friday of the contract month. Usually traders roll over, to the next contract, about eight days before expiration date, but like one post above said - looking at volume is ussually the best way to roll. As soon as March 2019 will expire - that same day June contract of 2020 will start trading. Stock Index futures do not have many foreward expirations since almost all volume is traded in the current contract.

 

Good luck,

Simon

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