SITE_NAME |
|
|
What Is Rollover Interest In The Forex Market?
In the spot forex market, all trades must be settled in two business days. A rollover refers to the process of closing open position for today's value date and the opening of the same position for the next day's value date at a price reflecting the difference in interest rates between the two currencies.
In accordance with international banking practices, Forex brokers automatically rolls over all open positions to the next date at 5 PM EST for settlement. Rollover involves exchanging the position being held for a position expiring the following settlement date. For example, for trades executed on Monday, the value date is Wednesday. However, if a position is opened on Monday and held overnight, the value date is now Thursday. The exception is a position opened and held overnight on Wednesday. The normal value date would be Saturday; because banks are closed on Saturday the value date is actually the following Monday. Due to the weekend, positions held overnight on Wednesday incur or earn an extra two days of interest. Trades with a value date that falls on a holiday will also incur or earn additional interest. Forex Traders can earn interest on rollovers, depending on the direction of their positions and interest rate differential between the two currencies involved. For instance, the primary interest rates in Great Britain are much higher than in Japan, so if a trader buys GBP, he/she will earn interest at 5 PM EST time. on the other hand, if he/she sells GBP in this currency pair, he/she will pay interest at 5 PM EST time. Overnight Interest/Rollover is automatically paid to a client's account after buying a currency with greater Interest Rate in its country, and charged to a client's account if the country issuing this currency has smaller Primary Interest Rates. About the Author: Martin Maier is the Founder of Fenix Capital Management LLC http://www.fenixcapitalmanagement.com . He is the developer of various futures and commodities trading programs and his systems have been ranked and rated by various large American Investment Profile Rating Companies such as STAR and MAR. Source: www.isnare.comWritten by: Martin Maier Getting Started With Forex Trading Learn Forex Trading So You Would Like To Trade Forex What Is Forex Trading All About An Explanation Of Forex Trading A Comprehensive Forex Broker Register Five Reasons You Have To Start Forex Trading Forex Trading Information Beware Of Frauds Forex Trading Making Money With Money Online Forex Trading Is Quickly Becoming A Booming Business Sending Signals For Trading In Forex What Is A Forex Broker Where To Get Forex Training All About Forex What You Need To Know A Beginner S Guide To Forex A Look At Forex Market Makers Forex Expertadvisor Mechanical Trading Systems What Every Trader Should Know Forex Market Offers Opportunity And Information Forex Trading Create Fantastic Wealth From Forex Trading Is Forex Trading Better Than Stocks Learn Forex The Duty Of A Forex Market Maker Day Trading Forex Market Behaviour How To Learn Forex Major Advantages To Trading Forex Starting Out With Forex Online Trading Disclaimer Privacy Forex And Commodities Futures And Options What To Know Before You Trade Forex Trading For The Little Guy Pivot Points In Forex Mapping Your Time Frame Revealed Million Dollar Forex Investing Mistakes How To Start Trading The Forex Market Part 7 Forex Enterprise A Full Review Forex Charting Lesson Chapter 1 Introduction The Miracle Of Forex Forex Case Study The Canadian Dollar An Overview Of Forex Investing Strategies Impress Your Date With Forex Trading Lingo How Does Forex Compare To Other Investment Markets The Uses In Forex Trading Of Moving Averages And Macd Three Important Forex Concepts For New Traders Forex And The Anatomy Of An Elliot Wave How Many Forex Order Types There Are And How To Use Them In Your Favor Forex Glossary Explosive Profits 7 Reasons To Trade Forex Example Of A Profitable Transaction In Forex Forex For Absolute Dummies How To Start Trading The Forex Market Part 5 Snippetsrss Forex System 24 Hour Trading Transparent Currency Trading Market Always Open For Business Forex Signal Services Forex Rates Forex Fund Averages 20 Per Month |
Articles & Resources
Five Reasons You Have to Start Forex Trading
Click the Chart Below to Get What You Need ...
Forex Glossary
|
| SITE_COPYRIGHT All rights reserved :: Privacy :: TOS :: Contact :: Articles | |