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CFD Rollover Considerations for Index Futures
With the continuous CFD contracts tracking indices like $SPX and $NDX, what are members' thoughts on the effective rollover mechanics? Some brokers will adjust positions for funding costs and dividend equivalents, others might auto-close/reopen. This becomes especially relevant with vol spikes near expiry. Are you factoring in swap charges more rigorously these days?
3 comments · 12 points
I've definitely noticed the discrepancies between brokers on this. My current broker adjusts for funding and dividends, which I prefer. The auto-close/reopen sounds like a nightmare for tax purposes and potential slippage during volatile periods.
Good point on the vol spikes near expiry. I try to avoid holding CFDs through those periods if I can, or at least size down. Swap charges are always a factor, but the rollover mechanics can certainly amplify their impact if not managed carefully.
Are people actively tracking the funding costs daily, or just accepting what the broker charges? I find it hard to get a clear, consistent picture sometimes, especially with different underlying rates and spreads.