You can hold a futures contract for as long as you want up to its expiration date, which may be a few weeks to several months away depending on the product. To keep exposure past that date, you roll the position by closing the expiring contract and opening one in a later month. Done repeatedly, rolling lets you maintain a position for months or years, but each roll brings transaction costs, potential price differences between contract months, and a taxable event.
Expiration Depends on the Product
Every futures contract has a built-in deadline set by the exchange where it trades. Under federal law, designated contract markets have the authority to establish the terms of each contract, including when it expires.1Office of the Law Revision Counsel. 7 USC 7 – Designation of Boards of Trade as Contract Markets The schedule varies with the underlying asset.
Crude oil futures list a separate contract for every calendar month, reflecting continuous production and consumption.2CME Group. Crude Oil Futures Calendar Financial index products such as the E-mini S&P 500 expire quarterly, in March, June, September, and December, which concentrates volume and keeps spreads tighter.3CME Group. FAQ: Weekly and EOM Options on S&P 500 Futures Micro contracts, at one-tenth the size of standard E-minis, follow the same calendar as their full-sized counterparts.4CME Group. Micro E-mini Futures and Options
Exchanges publish these calendars years in advance, so the expiration of any contract you’re considering is knowable up front. When an expiration falls on a holiday or weekend, the exchange shifts the official trade date to the next available business day.5CME Group. CME Group Holiday and Trading Hours
The Two Deadlines Before Expiration
As a contract approaches its final day, two dates dictate how much time you actually have to act.
First Notice Day is the earliest date the clearinghouse can assign a delivery notice on a physically settled commodity. If you hold a long position past this date, you may receive a notice requiring you to accept the physical goods, whether that’s grain, metal, or livestock. The regulatory framework defines the spot month as beginning around the day before delivery notices can first be issued.6eCFR. 17 CFR Part 150 – Limits on Positions
Last Trading Day is the final moment you can buy or sell the contract on the open market. Once trading closes, any remaining position moves to settlement, whether physical delivery or cash payment. You lose the ability to simply exit.
Most brokerage firms set their own internal deadlines hours or days ahead of the exchange’s cutoffs. If you’re still holding when your broker’s deadline passes, the broker closes the position for you, and many charge a forced-liquidation fee (around $25 at some firms) on top of standard commissions.7E*TRADE. Pricing and Rates Mark these dates on your calendar well ahead of time.
What Happens If You Hold Through Expiration
Contracts on tangible commodities like gold, crude oil, and agricultural products can require the actual transfer of goods through an exchange-approved warehouse. Once you take delivery, you’re responsible for ongoing storage costs. For gold futures on COMEX, for instance, approved depositories charge around $20 per contract per month.8CME Group. Approved Changes in Gold, Gold (Enhanced Delivery), and Silver Storage Rates for Asahi Depository LLC Most retail traders avoid physical delivery entirely by exiting before First Notice Day.
Financial products like stock index futures and interest rate futures settle in cash. The exchange calculates the difference between your entry price and the final settlement price and credits or debits your account. No goods change hands.
Rolling to Extend a Position
Because every contract expires, holding a long-term view requires rolling: closing the expiring contract and simultaneously opening the same position in a later month. You can repeat this indefinitely.
How the Trade Is Placed
The efficient way to roll is a calendar spread order, which packages both legs into a single transaction. You trade the price difference between the two contracts rather than executing each leg separately, so you cross only one bid-ask spread instead of two. For heavily traded products like Treasury futures, calendar spreads can reduce the bid-ask cost of rolling by as much as 75% compared with two separate orders.9CME Group. Treasury Futures Calendar Spreads
When to Roll
Volume gradually migrates from the expiring contract to the next month as expiration approaches. For many products, the bulk of open interest shifts during the last ten business days before the contract month begins.10CME Group. Pace of the Roll User Guide Rolling inside that high-volume window keeps slippage down. Waiting until the final day or two means thinner liquidity and wider spreads.
What the Roll Costs
Each roll involves commissions and exchange fees on both the closing and opening trades. Brokerage commissions for standard E-mini contracts run roughly $0.75 to $2.25 per contract per side at major U.S. brokers, with exchange and regulatory fees added. Micro contracts cost less per trade, sometimes under $0.50 per side. Roll monthly or quarterly and those costs accumulate.
The Curve Cost: Contango and Backwardation
Transaction fees aren’t the only cost of rolling. The price gap between the expiring contract and the next one can work for or against you.
In contango, later-dated contracts trade at higher prices than near-term ones, common in commodity markets where storage, financing, and insurance push future prices above spot. Rolling a long position in contango means selling the cheaper expiring contract and buying the more expensive deferred one, a net cost each time.11CME Group. What Is Contango and Backwardation
In backwardation, near-term contracts trade at higher prices than later-dated ones, sometimes because holding the physical commodity right now has value (convenience yield). Rolling a long position then means selling the more expensive contract and buying the cheaper one, a net gain on the roll.11CME Group. What Is Contango and Backwardation
Over months or years of repeated rolling, the cumulative effect can affect your total return more than commissions do. Crude oil has spent extended periods in contango, so long-term holders paid a steady roll cost even when spot prices barely moved.
Margin Stays Locked Up the Whole Time
Holding a futures position requires maintaining a cash deposit called a performance bond or margin. This is collateral held by the clearinghouse to cover daily losses, not a down payment.
Initial margin is the deposit required when you open a position. For one E-mini S&P 500 contract, this was approximately $24,200 as of early 2026. Maintenance margin is the minimum equity you must keep to hold the position, roughly $22,400 for that same contract.12CME Group. E-mini S&P 500 Futures Margins
If your account equity drops below maintenance because the market moved against you, your broker issues a margin call and you must deposit enough to restore initial margin. Fail to meet the call promptly and the broker can liquidate your position without further notice. Requirements change with market volatility, so the amount you need to hold can rise even while your position stays the same.13CME Group. Performance Bonds/Margins Micro E-mini contracts require roughly one-tenth the margin of full-sized counterparts, making them more workable for smaller accounts holding across multiple cycles.
Tax Consequences of Holding, Closing, or Rolling
Futures contracts get special tax treatment under federal law that applies whether you close, roll, or simply hold through year end.
Under Section 1256 of the Internal Revenue Code, any gain or loss on a regulated futures contract is split into 60% long-term and 40% short-term capital gain, regardless of how long you actually held it.14Office of the Law Revision Counsel. 26 USC 1256 – Section 1256 Contracts Marked to Market Because long-term rates are lower, this blend is generally favorable compared with stocks held under a year.
Even if you don’t close or roll before December 31, the IRS treats every open Section 1256 contract as if you sold it at fair market value on the last business day of the tax year.14Office of the Law Revision Counsel. 26 USC 1256 – Section 1256 Contracts Marked to Market Any unrealized gain or loss is included in that year’s taxable income, and your cost basis is adjusted when you eventually close so you aren’t taxed twice. Amounts are reported on IRS Form 6781, with broker valuations arriving on Form 1099-B.15Internal Revenue Service. Instructions for Form 1099-B
Each roll is itself a taxable event. Closing the expiring leg realizes a gain or loss on that contract; opening the next month’s contract doesn’t defer it. The 60/40 split still applies. Frequent rolling generates a string of smaller realized gains and losses through the year, all reported on Form 6781.16Internal Revenue Service. Form 6781 – Gains and Losses From Section 1256 Contracts and Straddles Keep detailed records of each roll’s entry and exit prices.