Forex swaps can affect your trading costs, especially if you frequently hold overnight positions。This article describes how to calculate swap charges。

In Forex trading, there are many important terms that traders should be aware of。Forex swaps are one of the most undervalued terms, but one of the most important because it can affect your potential profits or losses。In this article, we will discuss the main Forex brokersForex Swaps in Exness。Hopefully by the end of this guide you will be able to calculate your swap costs and know how to take advantage of them。

What is a foreign exchange swap?？

Each country has different interest rates on its own currency, and these rates often change。That's why some rates are higher and others are lower。For example, suppose the interest rate in Australia is2%, the interest rate in the United States is 0.25%。Traders who want to trade the AUD / USD currency pair must pay or receive the difference between the interest rates of the two currencies。This difference is called a swap.。

Swaps can be long or short depending on the type of position you open (buy or sell)。Swaps can also be positive or negative, so you can pay a fee or earn a fee for holding an overnight position。

If a long position is held overnight, the trader pays interest based on the US dollar rate and receives interest based on the Australian dollar rate。In other words, the trader will get2% (AUD rate) and pay 0.5% (dollar interest rate), so each trader will receive 1.5% swap。On the other hand, if a trader opens a short position and keeps it open overnight, each lot will receive -1.5% of negative swaps。

When to charge swap fees？

When swap fees are charged to your live account depends on your broker。Most brokers charge swap fees around midnight, butExness charges at 22: 00 GMT + 0 each day (except weekends) until the position is closed。

It is worth noting that swap fees are sometimes charged for opening positions on weekends。在在In Exness, swap amounts are charged at three times the rate on Wednesdays (or Fridays for energy products) to compensate for the following weekend, when swaps do not apply.。

That is, if you hold a position overnight on the day the swap is charged over the weekend, you will get a swap three times larger than a normal swap。

How inExnessOn the calculation of swap charges

Depending on the broker you use, calculating swap fees can be quite complicated。If you are inExness trading, you can easily check the swap amount from the trading platform。Just open the platform, log in to your account, open the transactions tab and view the swap amount on the left side of the screen。But keep in mind that this feature is only available for MetaTrader 4。

If you want to calculate the potential swap amount before opening a trade, you can use the trader calculator on the broker's website, or you can do the calculation manually using the following formula:

Hands x Contract Size x Spread Size x Short Swap or Long Swap x Days

Case Studies

Here is an example:

Suppose you use a standard account on Tuesday1 lot of EURUSDm's long position was opened at 15: 00 and then closed at 23: 00 on Thursday。

Since this is a long position, you need to use a positive swap rate for the calculation。You can view the broker's contract specifications。In this example, the swap rate is-0.86852。

In addition, the position remained open during the overnight period, which lasted from Tuesday to Wednesday, for a total of3 days。One swap per day, and on Wednesday, the swap triples。Thus, in this example, the total number of swaps charged is 5 days。

Now that we have every number we need, we can enter them into the formula to calculate。

1 x 100,000 x 0.0001 x (-9.86852) x 5 = -44.42 USD

Since this is a negative swap, the amount will be deducted from your account。

Make money with swaps

As mentioned above, swaps can be positive or negative。This means that swaps allow you to both pay interest and profit from the transaction。In foreign exchange trading, there is actually a strategy that can be profitable by using swaps, which is the carry trade。

A carry trade involves borrowing a currency with a low interest rate and investing in a currency with a high interest rate。In the previous example, this means borrowing dollars and investing in Australian dollars。

Since the strategy focuses on the difference between interest rates, it is important to choose two currencies with significant interest rate differences。It is worth mentioning that the strategy is not risk-free, as unexpected market fluctuations may offset the profits from collecting daily swaps.。As a result, carry trades are more suitable for large traders who prefer long-term positions。

Whether there is no swap account？

We can summarize that the amount of the swap rate depends on several factors, such as the broker you use, the type of position, the instrument, the number of days the position is open, and the nominal value of the position。

But what if you want to eliminate swap fees altogether？

Some brokers, includingExness, an Islamic non-swap account that does not charge a foreign exchange swap fee on its overnight position。The account is applied automatically and only for Muslim traders living in Islamic countries。

Lenders are not allowed to charge interest under Sharia law, so swaps are prohibited。Some brokers may trade other types of fees for no swaps, such as a weekly fee charged at the start of a trade, while others may not charge any additional fees at all。

Note that if a customer is found to have abused the no-swap status of their account,Exness may cancel the no-swap status on its account and charge a swap fee for any open positions and future orders opened。

有关ExnessFor more information, see the following information:

The choice of broker is adjusted to the needs of each trader。If you are a trader who only needs the basic platform and trading features with the best attributes, thenExness may be your best choice。

Exness passes as low as only 0.1 point of the low point difference to make up for the lack of its functional changes。This is ideal for traders using scalping trading strategies (Scalper)。In some account types, the spread of major currency pairs can also be as low as 0.0 point, depending on market conditions。

Not only that, traders can also enjoy other advantages such as automatic withdrawals。Exness will process most customer withdrawals on the fly without manual inspection; however, withdrawals may be limited depending on the payment provider or the method chosen。

The safety of the trader's funds is also guaranteed becauseExness is one of the European-based STP / ECN brokers。Exness became an official partner of the Real Madrid football team for a period of 3 years, starting in July 2017, which also proves the high stability of the company。

Deposits and withdrawals can7*24ProvideHowever, please note that the company will not be liable if the processing of deposits and withdrawals is delayed due to the payment system。

Traders don't need to worry about transaction fees when making deposits and withdrawals。Exness Even though some transactions may incur some fees,No transaction fees are charged to traders.Traders are offered a variety of payment methods, including wire transfers, bank cards,Neteller, Skrill, etc。

Financial reports and metrics on the Exness website are reviewed quarterly by Deloitte, one of the world's four largest accounting firms。

In addition,Exness is one of the most transparent brokers in the online trading industry。Traders can find all information about the company on the website, such as trading volume, number of active customers, customer deposits, company funds, etc.。

Exness offers platforms including MetaTrader 4, MetaTrader 5, web and mobile platforms。This allows traders to tradeExness becomes convenient when they can access the Exness platform anytime, anywhere。

Over the years,Exness has evolved into a broker that attracts traders。By December 2018, their clients "monthly trading volume reached $348.4 billion, with more than 50,342 active traders worldwide.。

通过Exness offers programs, traders also have the opportunity to earn additional income by becoming their partner。Through the Introducing Broker (IB) program, partners can receive up to 33% spread commission from each new client registered in their name。

can also passExness Partners Earns Additional Revenue。Traders can earn up to 25% spread commission per trade from traders registered through affiliate links。

in connection withWhen Exness is traded, customers can also take advantage of theirFree of chargeVPS Hosting ServicesVirtual Private Server (VPS) can improve the reliability and stability of traders because they can keep trading and expert advisors running in the event of unexpected technical problems (such as Internet or power outages)。

It can be concluded from the comments above that due to low spreads and flexible account types,Exness is the broker of choice for traders。This situation is very suitable for traders with limited funds but need more profit opportunities.。The broker is also known for its maximum support for new and old partners.。