What is 'Rollover'? How is it calculated?

Rollover is the difference between closing and opening prices of two different months' contracts for a Futures product. Futures positions that are left open through the expiration date are adjusted with the rollover fees, which can be a charge or a credit on the account, to reflect the price differences between the expiring and the new contract.

On the chart, a rollover can also be identified as a gap:

To calculate the rollover fees, let's follow the below example of VIX:

Suppose the closing price of VIX for the expiring contract is $12.3 and the opening price for the new contract is $14.8. This means there is a difference of $2.5 between these two contract prices.

We know that the contract size for VIX is 1000 units per standard lot. You will also need to adjust this difference as per the volume and currency of your trading account.

Now, if you are trading 0.3 lots, the rollover adjustment will be as following: 

Rollover Adjustment = Difference * Contract size * Volume traded 

Therefore, $2.5 x 1000 x 0.3 = $750 USD

Note: VIX is measured in USD. If your trading account is in another currency, conversion rates will be applicable.