On my demo I account, I have these trades open at the moment and they’ve been open since the 5th of May. The rollover doesn’t seem to be changing, it did at the start but now it’s just stuck at 7. Is there a limit to how much the rollver can be or what?
no there is no limit. but you have 2 trades where you receive roll over and 1 where you pay roll over so it balances itself out and stays fixed around 7.
on 2 you receieve
on 1 you pay
=
0 no movement as long as the rol over fees/benefits balance itself out
Oh I see, thanks.
So am I paying 7 pips? rollover per day or for as long as the trade is open? I don’t know what the rollover means, is it in pounds? pips?
rollovers are paid in 24 hpurs interval if u hold ur trades over night. on your sell/buy button you should see the rollovers displayed as somethibg like -0.018 or something like that. its calculated upon the size of your position. you have 250 contracts open on obe position the rollover is -0.018 per 1 open contract (0.018 x 250)
dont know why your demo account isnt calculating them in for real. maybe its programmed that way to not scare new traders away no clue. ask them aswell for how exactly they operate
Hi UKForex,
It’s best if I explain rollover interest to you in steps.
First, consider how it works when you deposit money in a bank account. Effectively, you are lending money to the bank, so you can earn interest on your money which the bank pays you. Conversely, if you get a loan from a bank, then you must pay interest to them for the money you borrow.
Rollover interest in the forex market works the same way, except you earn or pay it daily instead of monthly, and it involves two currencies: one that you are long, and one that you are short. For example, if I buy USD/JPY, then I am long US dollars and short Japanese yen. If I sell USD/JPY, then I am short US dollars and long Japanese yen.
I earn interest on the currency I am long, while I pay interest on the currency I am short. That means, for any currency pair, I will earn rollover interest, if I am long the currency in the pair with the higher interest rate of the two. However, if I am short the currency with the higher interest rate, then I will pay rollover interest.
Note that in order to earn or pay rollover interest, your trade must be open at 5pm New York Time on a weekday. That is the cutoff point that divides one 24-hour trading day from the next. Only trades that are held through that cutoff period must be rolled over from one trading day to the next, earning or paying the appropriate day’s worth of interest.
The exact amount of rollover interest, I can earn or pay is displayed in the RollS and RollB fields of the Advanced Dealing Rates window. RollS applies if I sold the currency pair. RollB applies if I bought the currency pair.
The information above is taken from one of my trading accounts which is denominated in USD. That means the RollS and RollB values are shown in US dollars. If you have a GBP-denominated trading account, then RollS and RollB will be displayed for you in British pounds.
The amount shown applies for a 10k trade, so if you have a 60k trade simply multiply the amount by 6. For a 2k trade, you can divide the amount show in the Roll columns by 5. That means, if bought 100k AUD/USD and held that position open through 5pm New York Time today, I would earn $2.50 in rollover interest (0.25 USD * 10).
For more information on rollover interest, and how it is affected by weekends and bank holidays, visit the Rollover Calendar on DailyFX.com.
Hi TURBONero,
I can’t speak for other brokers, but FXCM’s demo accounts show traders rollover interest in the same way as our real accounts. Forex traders who are long a given currency can earn rollover interest on it in the same way that stock traders can earn dividends on shares they are long. Why would we want to hide that benefit?
The Rollover amount shown in the Open Positions window is the total amount accumulated since the trade was opened. For the amount over rollover interest you earn or pay each day per trade, you can click on the Report button to view a Combined Account Statement. You will see the daily rollover in the Account History Section.
Hi Jason, so in my screenshot I assume I’m earning 7 pips a day instead of paying 7 pips a day? Is this the case?
Hi UKForex,
The net Rollover shown in the Total row of your Open Positions window is a positive number. That means you are earning this interest, not paying it.
Note this amount is not shown in pips but in the currency in which your account is denominated. Your forum username is UKForex, so I assume you set up a GBP-denominated trading account. Therefore your rollover, equity, profit and losses are all shown in British pounds.
Also note the Rollover amount shown in the Open Positions window is the total amount accumulated since the trade was opened. For the amount over rollover interest you earn or pay each day per trade, you can click on the Report button to view a Combined Account Statement. You will see the daily rollover in the Account History Section.
Jason just a quick follow up question, as you mentioned I am earning £7 a day but am I also being charged £22.50 commission a day? So I’m actually losing £15.50 per day? Or is the commission not charged daily and it’s just the one time fee?
Commission is not charged daily. You pay it once when you open your trade, and once when you close it. On our No Dealing Desk (NDD) forex execution, we make money from your trading volume. FXCM wants you to be successful, so you can trade more with us.
If you click on the Report button on your Trading Station, you can view a Combined Account Statement for any time period since you opened your account to review commissions, rollover, profits and losses.
Hi
Thanks so much for clarifying some of the mechanics.
re your comment below; may I ask: If a trade is closed prior to New York 5pm does that mean no interest [either way] is calculated…?
thanks very much for your time.
Chris
“Note that in order to earn or pay rollover interest, your trade must be open at 5pm New York Time on a weekday. That is the cutoff point that divides one 24-hour trading day from the next. Only trades that are held through that cutoff period must be rolled over from one trading day to the next, earning or paying the appropriate day’s worth of interest.”
It’s my pleasure, Chris, and you have understood correctly. If you close a trade before 5pm New York Time then you will not earn or pay any rollover interest that afternoon.
That means, you could open at trade at 5:00:01 pm on Tuesday and close it at 4:59:49 pm on Wednesday, you would not earn or pay any rollover interest on this trade even though it was open for 23 hours 59 minutes and 58 seconds.
By contrast, if you opened a trade at 4:59:59 pm on Wednesday and closed it two seconds later at 5:00:01 pm, you would earn or pay 3 days’ worth or rollover interest (except in bank holiday affected weeks), even though the trade was only open for 2 seconds.
That is because Wednesday’s 5pm rollover includes the interest for Saturday and Sunday, since trading is closed for the weekend and no interest can be applied on those days directly.