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.com

Written by: Martin Maier

How Many Forex Order Types There Are And How To Use Them In Your Favor
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learne...
how_many_forex_order_types_there_are_and_how_to_use_them_in_your_favor.htm

Three Important Forex Concepts For New Traders
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
three_important_forex_concepts_for_new_traders.htm

Forex Fund Averages 20 Per Month
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_fund_averages_20_per_month.htm

Impress Your Date With Forex Trading Lingo
The Forex market is growing rapidly and while For...
impress_your_date_with_forex_trading_lingo.htm

What Is A Forex Broker
The Forex market is growing rapidly and while Fore...
what_is_a_forex_broker.htm

Forex Trading Information Beware Of Frauds
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_trading_information_beware_of_frauds.htm

Getting Started With Forex Trading
The Forex market is growing rapidly and whil...
getting_started_with_forex_trading.htm

The Duty Of A Forex Market Maker
The Forex market is growing rapidly and while Forex trading is no...
the_duty_of_a_forex_market_maker.htm

Forex For Absolute Dummies
The Forex market is growing rapidly and while...
forex_for_absolute_dummies.htm

Where To Get Forex Training
The Forex market is growing rapidly and while Forex trading is not s...
where_to_get_forex_training.htm

Forex Enterprise A Full Review
The Forex market is growing rapidly and while Forex ...
forex_enterprise_a_full_review.htm

The Uses In Forex Trading Of Moving Averages And Macd
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
the_uses_in_forex_trading_of_moving_averages_and_macd.htm

Major Advantages To Trading Forex
The Forex market is growing rapidly and while Forex trading is not simple, it is e...
major_advantages_to_trading_forex.htm

Forex Trading Making Money With Money
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_trading_making_money_with_money.htm

Five Reasons You Have To Start Forex Trading
The Forex market is growing rapidly and while Forex trading is ...
five_reasons_you_have_to_start_forex_trading.htm

Example Of A Profitable Transaction In Forex
The Forex market is growing rapidly and while Forex trading is not simple, it is easi...
example_of_a_profitable_transaction_in_forex.htm

Explosive Profits 7 Reasons To Trade Forex
The Forex market is growing rapidly and while Forex tra...
explosive_profits_7_reasons_to_trade_forex.htm

How To Learn Forex
The Forex market is growing rapidly and while Forex trading is not simple, i...
how_to_learn_forex.htm

A Beginner S Guide To Forex
The Forex market is growing rapidly and whil...
a_beginner_s_guide_to_forex.htm

Learn Forex Trading
If you want to learn to trade Forex, it is paramount that take the t...
learn_forex_trading.htm

Forex And The Anatomy Of An Elliot Wave
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_and_the_anatomy_of_an_elliot_wave.htm

Forex Glossary
The Forex market is growing rapidly and while Forex trading is not...
forex_glossary.htm

How Does Forex Compare To Other Investment Markets
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
how_does_forex_compare_to_other_investment_markets.htm

How To Start Trading The Forex Market Part 5
The Forex market is growing rapidly and while Fore...
how_to_start_trading_the_forex_market_part_5.htm

Forex And Commodities Futures And Options What To Know Before You Trade
The Forex market is growing rapidly and while Forex trading...
forex_and_commodities_futures_and_options_what_to_know_before_you_trade.htm

So You Would Like To Trade Forex
You'd like to learn how to trade Forex and becomin...
so_you_would_like_to_trade_forex.htm

Revealed Million Dollar Forex Investing Mistakes
The Forex market is growing rapidly and while Forex trading is not ...
revealed_million_dollar_forex_investing_mistakes.htm

Starting Out With Forex Online Trading
Trading on the Forex, aka the foreign exchange, has never been easier than it is today and Forex online tradi...
starting_out_with_forex_online_trading.htm

Sending Signals For Trading In Forex
The Forex market is growing rapidly and while Forex trading is not simpl...
sending_signals_for_trading_in_forex.htm

Learn Forex
The Forex market is growing rapidly and whi...
learn_forex.htm

How To Start Trading The Forex Market Part 7
The Forex market is growing rapidly and while F...
how_to_start_trading_the_forex_market_part_7.htm

Is Forex Trading Better Than Stocks
The Forex market is growing rapidly and while Forex trading is not simple, it is easily le...
is_forex_trading_better_than_stocks.htm

Privacy
...
privacy.htm

Pivot Points In Forex Mapping Your Time Frame
The Forex market is growing rapidly and wh...
pivot_points_in_forex_mapping_your_time_frame.htm

Snippetsrss
...
snippetsrss.htm

What Is Forex Trading All About
The Forex market, aka. the foreign exchange, is open 24 hours a day, d...
what_is_forex_trading_all_about.htm

An Overview Of Forex Investing Strategies
The Forex market is growing rapidly and while Forex trading is n...
an_overview_of_forex_investing_strategies.htm

Forex Signal Services
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_signal_services.htm

Disclaimer
...
disclaimer.htm

Forex Case Study The Canadian Dollar
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_case_study_the_canadian_dollar.htm

Online Forex Trading Is Quickly Becoming A Booming Business
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
online_forex_trading_is_quickly_becoming_a_booming_business.htm

Forex Trading Create Fantastic Wealth From Forex Trading
The Forex market is growing rapidly and while Forex trading is not simple, it is...
forex_trading_create_fantastic_wealth_from_forex_trading.htm

Forex Rates
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_rates.htm

Forex Expertadvisor Mechanical Trading Systems What Every Trader Should Know
The Forex market is growing rapidly and while Forex trading is no...
forex_expertadvisor_mechanical_trading_systems_what_every_trader_should_know.htm

Forex Market Offers Opportunity And Information
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_market_offers_opportunity_and_information.htm

Forex System 24 Hour Trading Transparent Currency Trading Market Always Open For Business
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learne...
forex_system_24_hour_trading_transparent_currency_trading_market_always_open_for_business.htm

Forex Charting Lesson Chapter 1 Introduction
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
forex_charting_lesson_chapter_1_introduction.htm

The Miracle Of Forex
The Forex market is growing rapidly and while Forex tradi...
the_miracle_of_forex.htm

An Explanation Of Forex Trading
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
an_explanation_of_forex_trading.htm

A Comprehensive Forex Broker Register
The Forex market is growing rapidly and whil...
a_comprehensive_forex_broker_register.htm

Day Trading Forex Market Behaviour
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
day_trading_forex_market_behaviour.htm

All About Forex What You Need To Know
The Forex market is growing rapidly and while Forex trading is not simp...
all_about_forex_what_you_need_to_know.htm

Forex Trading For The Little Guy
The Forex market is growing rapidly and while Forex tra...
forex_trading_for_the_little_guy.htm

A Look At Forex Market Makers
The Forex market is growing rapidly and while Forex trading is not simple, it is easily learned....
a_look_at_forex_market_makers.htm

Articles & Resources

Forex Case Study The Canadian Dollar

Foregin Exchange is one of the most popular investing markets, and with a proper understanding of the markets and factors influencing it it is possible to enjoy great success in terms of returns. A...

Continue ...

Forex Rates

Forex rates (currency prices) are a reflection of the supply and demand for currencies. The two main factors of forex rates are the strength of the...

Continue Forex Rates...

Click the Chart Below to Get What You Need ...

Forex market offers opportunity and information

The forex market is what is called an international exchange currency market, where currencies are exchanged on a daily basis. There are five forex...

Continue ...