Where to find interest rates for carry trade opportunties?
Just about every business website should have them. Central banks have them as well and you could find them in economic calendars. There is only a handful to keep in mind and many traders I now (including myself) have memorized them. Just run an online search for interest rates and you are likely to find plenty of sources.
Thank you. I’m using this approach to pick my pairs , using the rollover as my initial edge. What do you think of this screening approach ?
Ok . So acting on the advice of The Last Bear, I’ve found a site that offers interest rates. Now, which type of rate do I base my observations on : euribor, libor, or central banks’ ?
I would easily assume the central banks’ but , I avoid assumptions whenever possible.
Just because you see a nice CCY that offers a big interest rate differential doesn’t mean your broker will offer the same conditions.
Euribor/Libor are to do with the interbank short/medium term lending and determines the interest on loans the banks charge and nothing to do with your trading.
The central bank interest rates are known as ‘benchmark’ for a reason. They are merely a benchmark and not a standard, meaning that there is a +/- deviation which varies from one bank to another.
You want to focus on carry trade, look at the instruments window in your MT and check on the Symbol properties which gives you the overnight swap rate that is the actual rate you will be given on the shorts or longs.
[I]P.S: Curious to know, how much are you planning to deposit and trade with?[/I]
Thanks jw1981, I plan to start with an initial deposit of 2k. I don’t expect to incur anything significant from the carry trade. Just want to start the habit of trading in favor of it and picking pairs .