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156

Swap Rates in Forex

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Hello,

 

I was looking at the description of different currency pairs and I was wondering about the daily swap that is either added or subtracted from your account.

 

Can anyone give me an example of how much you will receive/lose to roll over his trade if he/she opens a long position in GBP/JPY for example, using the brokerage he does with 1 lot (100k).

 

Thanks!

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A great way to see how this works is to open a demo account, place a trade, leave it running and then see how much is credited or debited from your account each day that you leave it running. It is fairly significant but not compared with the profit on a profitable trade that is running for that length of time.

 

scott

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@156

 

Very good idea to inform about rates before you open an account / enter a trade.

 

There are huge differences in rates across brokers, you will have to check each one individually.

 

 

It is fairly significant but not compared with the profit on a profitable trade that is running for that length of time.

 

That can be awfully wrong.

 

 

For example have a look at:

 

http://www.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc

 

(In case someone does not like the link / it gets deleted, here's how to get there:

Interactive Brokers / Costs / Interest & Financing)

 

For INR (indian rupee) they charge 11.8%, for MXN 4.9%, EUR 0.36% at the time.

 

 

It can be a quite interesting trade to enter with a small amount of money into a long-term trade with some more or less exotic currency. But always check rates first.

 

People say Oanda has generally the lowest rates.

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@156

 

That can be awfully wrong.

 

 

For example have a look at:

 

http://www.interactivebrokers.com/en/accounts/fees/interest.php?ib_entity=llc

 

(In case someone does not like the link / it gets deleted, here's how to get there:

Interactive Brokers / Costs / Interest & Financing)

 

For INR (indian rupee) they charge 11.8%, for MXN 4.9%, EUR 0.36% at the time.

 

 

It can be a quite interesting trade to enter with a small amount of money into a long-term trade with some more or less exotic currency. But always check rates first.

 

People say Oanda has generally the lowest rates.

 

 

Yes, if you do trade an exotic currency such as the Indian Rupee, (almost no one does) make sure you only enter a profitable long term trade and only in the direction of positive interest. Typically if you are in a profitable long term trade and it lasts for several days you will be earning hundreds of PIPS which means thousands of dollars per lot traded while the interest over those several days might end up being around $25. Compared with the profit on the trade it tends to be very tiny. I have been entering long term trades for several years and the interest positive or negative is always minute in my account. Not sure what happens in other people's accounts.

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