Forex overnight funding rates
Forex swap rates
Swap bid and offer are the overnight funding rates for carrying short and long positions, respectively. Swap rates are denominated in pips of the quote currency.
For every pair we offer a standard contract size (one contract = 100,000 of the first-named currency), with a minimum trade size of 0.01 lots (equivalent to 1000 of the first-named currency).
Major forex pairs
| Markets | Sell | Buy | Change | Swap Bid | Swap Offer |
|---|---|---|---|---|---|
| EUR/USD | - | - | - | - | - |
| GBP/USD | - | - | - | - | - |
| USD/CHF | - | - | - | - | - |
| USD/JPY | - | - | - | - | - |
| AUD/USD | - | - | - | - | - |
| USD/CAD | - | - | - | - | - |
For full product details and currency pairs click here.
Understanding swap rates
Swap rates estimate the overnight funding rate for forex positions by incorporating interest rate of the two relevant regions as well as the tom-next rate and admin fee. These rates can be positive (producing potential profits) or negative (producing potential losses), depending on the interest rate relationship of the forex pair.
The "swap bid" rate applies to short positions, while "swap offer" applies to long positions. For example, if the swap bid and offer for EUR/USD were 0.50 and (1.00), respectively, then a 1-lot short position would profit 0.5 pips, or $5, and a long position of the same size would lose 1.0 pip, or $10, from holding the position overnight.
What is a carry trade?
The carry trade can be simplified down to borrowing a currency in a region that has low interest rates for the use of buying a currency in a region that has high interest rates, effectively earning a high interest rate while paying a low one.
Monitoring the above swap rates can provide traders clarity on what their potential overnight profit could be, but risks of interest rate changes and price action of the underlying forex pair should be assessed as well.
Forex trading cost and charges
- Overnight funding fees
When you trade forex with us, you trade on margin. This means you provide a deposit to open a position, and we in effect lend you the rest of the money required. If you close your position on the same day, there is no funding fee. If you keep it overnight, we charge a small fee to cover the cost of the money you've effectively borrowed.
The fee is calculated as the tom-next rate plus a small admin fee, 0.5% per year.
- Currency conversion charges
Forex trading in a currency other than your account's base currency may incur a currency conversion charge. Our default setting is instant conversion, where foreign currency profit is converted to your base currency, and funding or commission charges are considered before your account is credited. We also offer daily, weekly, and monthly conversion settings. Our standard charge is 0.5%.
Visit our costs and charges document for examples of fees and charges.
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Open an account now
- Fast execution on a huge range of markets
- Trade on the move with our award-winning trading app*
- Feel secure with a trusted provider
FREQUENTLY ASKED QUESTIONS
Our offices are normally open 24 hours a day between 4pm on Sunday and close 5pm on Friday night (EST).
Trading hours vary between markets, but standard US market hours are 9:30am to 5:00pm (EST).
SPREADS
Our forex spreads vary depending on underlying market liquidity. The more liquid the market, the narrower our spread – as low as 0.8 pips. As the underlying market spread widens, so can ours.
FOREX OVERNIGHT CHARGES
The overnight funding fee is calculated using the tom-next rate. These rates change daily, varying the funding fee each day. Mini and micro forex contracts are subject to a higher funding rate. Find more info on costs and charges here.
Tom-next is the rate used to calculate the funding adjustment when a forex position is held overnight. It is an industry-standard rate, derived from the interest rate differentials of the pair’s currencies and market expectations of interest rate change. Find more info on costs and charges here.
The spread is the difference between our sell and buy prices. We derive these prices based on the underlying market's value.
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