The roll: where the contango cost actually lands

You learned to read the futures curve in module 2. This is the lesson where the curve stops being a picture and sends you a bill.

The mechanism, plainly

A commodity position that wants to exist next month must move to next month's contract, at next month's price. In contango - the resting state, because storage costs real money - the next month is dearer. Sell the front, buy the next, and the position now needs the price to rise by the gap just to stand still. Do that twelve times a year and the gaps compound into the steady leak that explains one of retail trading's oldest mysteries: the commodity that ended the year higher while the fund tracking it ended lower.

It is not a broker trick

A CFD's roll adjustment arrives as an overnight change to your position, and it is natural to read it as something the broker did to you. It is not. The gap is set on the exchange, by the storage economics from module 1, and a futures trader rolling by hand pays it to the tick. The broker chose the moment; the curve chose the amount. Maintaining exposure to a stored physical good costs what storing it costs - the roll is simply where that truth reaches your account.

And it runs both ways

Backwardation inverts the bill. When the front is dearest, each roll sells dear and buys cheap, and the rolling long is paid to stay - which is why professionals watch curve shape the way other traders watch price. Work the example below, then put your own products' front and next months into the calculator. For anything you hold longer than a month, this number belongs next to the financing figure in the plan - and for most commodity CFDs held long, it is the bigger of the two.