Forex overnight charges

Posted: stefan Date: 17.06.2017

As we explain on the expiries page, this type of bet is designed primarily for short-term positions. The charge will be triggered once you pass the daily cut-off time typically 10pm UK time, although this may vary for international markets. If you close your position on the same day before this time, there is no funding fee.

forex overnight charges

Note, overnight funding is only paid on daily funded spread bets, or cash CFDs. For the majority of markets, other than forex and spot metals, our funding fee is comprised of our admin fee plus or minus the relevant interbank rate for the currency in which your bet is made depending on whether your position is long or short.

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The interbank rate is the interest rate charged between banks for short-term loans. It is a key indicator for other interest rate charges. Our funding charge would be based on the Libor London Interbank Offered Rate one-month overnight rate, which is the interest rate that major banks charge to lend funds to each other. We would calculate it like this:. For a short position on the same market, the calculation would be the same except that Libor would be deducted from our 2.

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For forex and spot metals deals, we charge the tom-next rate plus a small admin fee no more than 0. Tom-next , an industry-standard rate, is short for 'tomorrow-next day', and is the means by which forex speculators are able to keep forex positions open overnight without taking physical delivery of a currency. They manage this by swapping any overnight positions for an equivalent contract that starts the next day.

forex overnight charges

The price difference between the two contracts is called the tom-next adjustment. Spread bets and CFDs are leveraged products and can result in losses that exceed deposits.

The value of shares, ETFs and ETCs bought through a share dealing account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Please ensure you fully understand the risks and take care to manage your exposure. CFD, share dealing and stocks and shares ISA accounts provided by IG Markets Ltd, spread betting provided by IG Index Ltd.

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forex overnight charges

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Overnight funding If you place a short-term trade and want to keep it open overnight, you may be charged a daily interest fee. Why is overnight funding charged? How are the charges calculated? Shares, indices and other markets For the majority of markets, other than forex and spot metals, our funding fee is comprised of our admin fee plus or minus the relevant interbank rate for the currency in which your bet is made depending on whether your position is long or short.

We would calculate it like this: Forex and spot metals For forex and spot metals deals, we charge the tom-next rate plus a small admin fee no more than 0. Ready to put theory into practice? Demo account Create account. You might be interested in What is spread betting? Markets Forex Indices Shares Digital s Other markets. Trading platforms Web platform Trading apps Advanced platforms Compare features. IG analysis The week ahead Market news IG Live.

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