How Can an ETF Manager Mitigate the Risk of Contango in a Futures Fund?

An ETF manager can mitigate contango risk by strategically selecting futures contracts that are trading in backwardation or by using a "dynamic roll" strategy. A dynamic roll involves not strictly adhering to a monthly roll schedule but instead choosing the most advantageous contract to roll into, based on the shape of the futures curve, to minimize the negative roll yield.