Hey guys,
Just wanted to ask if anyone knows a broker who has with any pair positive swap bigger than negative, so we can hedge and earn easy money on swap. This would be nice riskless profit until the broker doesnt change the swap rates. If you have time you can look at myfxbook -> broker swaps and do a little of research.
No, brokers are smarter than that.
Since your next logical step is going to be “Okay, 2 brokers, one where the long position pays swap more than the short costs in the other.” That won’t work either because that means one forex broker is overpaying or undercharging on the swap, which they won’t do.
I dont mean 2 brokers, just one broker hedging. it is tough to find such broker but it is possible. With 2 brokers it would be perfectly possible to hedge and earn on swaps, just look at the swap table and you can count that 15-20% yearly with safe swap hedging with 2 brokers is perfectly possible.
If you can find this for me and I can verify it I’ll paypal you $300 for it.
But I need a broker (or 2 brokers) that accepts US clients.
Huh. This thread has captured my interest.
I don’t believe it is possible to find a single broker who would allow you to profit from swap differential on a net-zero hedged position. It makes no sense; it would only cost them money to do so.
But what if you opened a swap-free account with say FXCM, and a regular account with Oanda, and split your capital between them? With $5k in each account, you would be able to control 1 lot of exotics like USD/TRY (or more lots if you’re not being suffocated by the CFTC here in the good ol’ USA).
Could you short 1 lot of USD/TRY with Oanda, and then long 1 lot of USD/TRY with FXCM? That would earn you ~$9k in interest annually from Oanda, and you would pay nothing in swap on your FXCM account. That is a 90% annual gain for taking almost no risk. Higher if you compound your position by reinvesting your swap into more lots.
Once a week or so you could equalize the account balances by transferring funds between them, to ensure that neither gets margin called. As long as you are net-zero, arbitrageurs will ensure that you are exposed to virtually no market risk.
So, anyone with a bit more experience want to chime in and tell me this is illegal or something? That the tax man will wag his finger at me and throw me in the pen for a few years?
If I actually solved the puzzle, do I win $300?
Just did some research, apparently brokers will revoke your swap-free account status and then charge you [B]all of the previously unaccrued swap[/B] if they catch you abusing the swap-free account in such a manner.
Knew it was too good to be true, lol.
->jadd: If you do more of research, you will find that there are few brokers charging no swaps or very tiny swaps. Or you can even find combo of 2 brokers where 1 will pay you positive swap for short and second for long, so you earn swap with both brokes while your positions are hedged.
->John: I accept your challange lol… can you describe by detail your conditions?
Just did some research, apparently brokers will revoke your swap-free account status and then charge you all of the previously unaccrued swap if they catch you abusing the swap-free account in such a manner.
Knew it was too good to be true, lol.
Also probably pretty easy to catch if all you do is buy and hold USDTRY and transfer money in and out of the account.
Faithblaster, if you can find two regulated US brokers, who accept US clients (and that I can open - I’m not sure if I can even get a swap free account by just signing up for one - there’s probably some proof involved), offer periodic free withdrawals and free deposits, on spot forex, where I don’t run the risk of having one account closed due to trying to take advantage of some swap gain, and between the two I can yield guaranteed profit of at least 15% using, say, 5:1 leverage or less, and I can verify that this is indeed the case (so there’s no misunderstanding by you, apparently some brokers quote in percentage interest, others quote in pips/day, could be a different misunderstanding), I will paypal you $300. To just close any loophole, I need to be able to replicate this so that I can achieve a guaranteed 15%+ return annually. If it’s not something I can replicate for some reason, then it doesn’t count.
Your Idea theoretically correct but the spreads will blow it up. for example the average spread is 160 pips
so it is 3 times the swap which means you will lose.