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Rollover has a number of different financial meanings, depending on the context.

When referring to financial securities such as bonds, rollover refers to reinvesting the funds paid at maturity into the same or similar type of security. Assume a bondholder had his bond called by the issuer.  The bondholder receives the principal amount and purchases a new, similar bond.  In this case, the bondholder rolled over the old principal into a new bond.

In the retirement savings realm, rollover refers to transferring the holdings in one retirement account into another.  Specifically, the securities held in the retirement account are liquidated and distributed to the account owner, who then deposits them into a new account for reinvestment.  Doing so insures the transaction is tax free under IRS rules. The original retirement plan administrator reports the distribution on Form 1099-R, and the receiving retirement plan administrator reports the rollover on IRS Form 5498.

In a foreign currency exchange (forex), rollover refers to moving a forex position to the next delivery date.  The fee charged for this move can be advantageous to the investor, because the fee is based on the difference in interest rates between the two currencies in the underlying transaction.  The difference can be negative.  A negative charge during a forex rollover results in a credit to the investor’s brokerage account, and may help that investor maintain a minimum level margin balance in his account. 

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