Roll over

A rollover is when you do the following: 1. Reinvest funds from a mature security into a new issue of the same or a similar security. 2. Transfer the holdings of one retirement plan to another without suffering tax consequences. 3. Move a forex position to the following delivery date, in which case the rollover incurs a charge. further;;; 1. Assuming an option about to expire is favorable to hold, you may decide to buy or sell the later expiring option. 2. Retirement plans may be moved in order to forgo tax consequences when moving from one company to another. The distribution is reported on IRS Form 1099-R and the rollover contribution is reported on IRS Form 5498. Rollovers may be limited to one per annum for each IRA and the assets are generally made payable to the retirement account holder. The assets must then be deposited to the receiving retirement account within 60 days after the account holder receives the assets. 3. The forex fee arises from the difference in interest rates between the two currencies underlying a transaction. Sometimes investors can earn a credit if they are purchasing the currency with the higher of the two interest rates. Investors are often required to maintain certain margin positions with their brokers to earn a credit from rollover. IN FOREX In foreign exchange trading (FX), a rollover is the action taking place at end of day, where all open positions with value date equals SPOT, will be rolled over to the next business day. This happens since in FX trading the trader doesn't want to actually buy the traded currencies but to continue to trade until position is closed. For example, on Monday all position with value date of Wednesday (in case of T+1) will be rolled over and the value date will be updated for Thursday. Position with value date of Friday will be updated with value date of next Monday. Trading platforms offer rollovers but the process involves a rollover interest fee which is calculated according to the difference between the interest rates of the traded currencies. On the long position, the trader get the interest rate and on short position she needs to pay the interest rate. In case of weekends and holidays, the rollover is multiplied by the number of days of rollover.