Front Month is the futures contract month nearest to maturity among the contract months currently trading for a given product. The CFTC also describes it as the spot or nearby delivery month. It identifies a contract’s position in the maturity sequence; it does not necessarily identify the contract with the most trading volume or open interest, and it is distinct from the cash-market spot price.
Nearest maturity is not always the active contract
As expiration approaches, market participants often move exposure into a later contract before the nearest contract stops trading. Liquidity can therefore migrate to the second-nearest maturity while the front month still exists. Terms such as lead month or active contract may be used for that more liquid reference contract, but usage is not perfectly uniform across venues and data products. The important distinction is between maturity order and market activity.
Front-month series are conventions, not positions
Historical front-month data is constructed by switching from one expiring contract to the next. A price series created by linking those contracts is useful for tracking the near end of the futures market, but it is not automatically the same as the return from holding and repeatedly rolling a futures position. The result depends on when the contract is switched and on the prices of the outgoing and incoming maturities at the roll. Data providers may also use different roll rules, so two series labelled “front month” can differ around rollover periods even when both are internally consistent.
This distinction becomes especially important near expiry and, for physically delivered futures, around notice and delivery procedures, when participants may move exposure forward well before the final trading or delivery stage. Researchers and traders should therefore document how a front-month series selects and changes contracts. Front month is fundamentally a nearest-maturity concept; liquidity leadership, execution choice and continuous-series construction are related but separate questions.