How does roll yield impact the profitability of cryptocurrency investments?

3 answers

• John RicksSep 05, 2020 · 5 years ago
  Roll yield can have a significant impact on the profitability of cryptocurrency investments. Roll yield refers to the profit or loss generated by rolling over futures contracts. In the context of cryptocurrency investments, it is the difference between the spot price and the futures price. If the futures price is higher than the spot price, investors can earn a positive roll yield by selling futures contracts. Conversely, if the futures price is lower than the spot price, investors may incur a negative roll yield. This can affect profitability as it adds an additional source of income or expense to the investment. It's important for investors to carefully consider roll yield when trading cryptocurrencies to maximize their profitability.
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• Prashant Mani TripathiJan 17, 2025 · 7 months ago
  Roll yield plays a crucial role in determining the profitability of cryptocurrency investments. When the futures price of a cryptocurrency is higher than the spot price, investors can earn a positive roll yield by selling futures contracts. This can significantly enhance their profitability. On the other hand, if the futures price is lower than the spot price, investors may experience a negative roll yield, which can reduce their profitability. Therefore, understanding and effectively managing roll yield is essential for maximizing the profitability of cryptocurrency investments.
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• leonel morgadoSep 03, 2023 · 2 years ago
  Roll yield is an important factor that can impact the profitability of investing in cryptocurrencies. It refers to the difference between the spot price and the futures price of a cryptocurrency. When the futures price is higher than the spot price, investors can earn a positive roll yield by selling futures contracts. This can increase their profitability. Conversely, if the futures price is lower than the spot price, investors may experience a negative roll yield, which can decrease their profitability. It's crucial for investors to consider roll yield when making investment decisions in cryptocurrencies to optimize their profitability.
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