Positions held overnight may be subject to a finance fee, or ‘swaps’. We define the start of a new trading day to be at 21:00 London time, and a position that is opened before this time, and remains open after, is classified as being ‘rolled over’ to the next day (also known as ‘held overnight’).
For example, a position is opened at 18:00 London time on Monday 14th May, and is still being held at 21:00 London time on May 14th; this position would be subject to swap fees. The swap fee is then applied every calendar day (including weekends), until the position is closed.
Calculation
Swap calculations are determined by the following formula:
Daily Swap (US$) =
Opening Contract Value (US$) x Interest %
36000
Example
You buy 1 lot of GBPUSD at a price of 1.62245 at 07:00 London time. The current swap on long positions is -0.5%。
Contract Value (US$) = 100,000 (GBP)x 1.62245 (
US$
GBP
)= 162,245 (US$)
Daily Swap (US$) =
162245 (US$) x-0.5
36000
= -2.25 (US$)
Therefore $2.25 will be charged to this position at 21:00 London time. This will continue to happen every day at 21:00 London time until the position is closed.
Products Affected
The following products are subject swap charges: FOREX, Spot Gold, Spot Silver and U.S Stocks. Futures Products are NOT affected.
Positive Interest
Certain trades, on affected products, will lead to the swap charge being credited to the position, instead of debited. This will be represented by a
Positive Interest % in Blue on the Finance Fee specification page. For a full list of the products and Interest % please click
here.
The calculation works the same way as above; except instead of the daily swap being subtracted, it is added to the trade P/L.
Example 2
You buy 2 lots of AUDUSD at a price of 1.01232 at 13:00 London time. The current swap on long positions is +2.25%.
Contract Value (US$) = 200,000 (AUD)x 1.01232 (
US$
AUD
)= 202,464 (US$)
Daily Swap (US$) =
202464 (US$) x2.25
36000
= +12.65 (US$)
Therefore $12.65 will be credited to this position at 21:00 London time. This will continue to happen every day at 21:00 London time until the position is closed.
