A swap, also called rollover or overnight fee, is the interest adjustment a broker books when you hold a position past the daily rollover time. Day traders can ignore it. Anyone who holds trades for days or weeks cannot, because swap can quietly become the largest cost of a position, larger than the spread and much larger than any cashback. This guide shows how to read swap values in your platform and convert them into money.
Why Swap Exists
A currency pair trade is economically a loan in one currency and a deposit in the other. If the currency you buy pays a higher interest rate than the one you sell, the position can earn a credit; if lower, it pays a debit. Brokers then add their own markup, which is why on many pairs both directions are negative. Swap rates change when central banks move rates and when the broker updates its pricing, so last month’s figure is only a guide.
Where to Find the Swap Rate
In MetaTrader, right-click the symbol in Market Watch, choose Specification, and look for swap long, swap short, the swap type and the 3-day swap day. The type matters:
| Swap type shown | Meaning | How to convert |
|---|---|---|
| In points | Points per 1 lot per night | Points × point value × lots |
| In account currency | Money per 1 lot per night | Value × lots |
| In percent (interest) | Annual rate on notional | Notional × rate ÷ 360 or 365 |
Worked Example: Converting Points to Dollars
Illustration only. Suppose EUR/USD shows swap long −7.0 points and swap short +2.0 points. On a 5-digit quote, one point is 0.1 pip, worth $1 per standard lot.
| Position | Per normal night | Triple swap night | One week (7 charges) | Four weeks |
|---|---|---|---|---|
| 1.00 lot long | −$7.00 | −$21.00 | −$49.00 | −$196.00 |
| 0.10 lot long | −$0.70 | −$2.10 | −$4.90 | −$19.60 |
| 0.10 lot short | +$0.20 | +$0.60 | +$1.40 | +$5.60 |
A week counts as seven charges because five rollovers happen and one of them is charged three times. These numbers are invented to show the arithmetic; read the real values in your own platform.
The Triple Swap Day
Spot forex settles two business days after the trade. A position rolled on Wednesday would settle across the weekend, so most brokers charge three days of swap on the Wednesday rollover. Other instruments can differ: indices, metals, energy and crypto CFDs may use another day, often Friday. The rollover time is commonly around 5 pm New York time, shown as midnight server time at many brokers. The specification window tells you the day for each symbol.
Swap vs Spread vs Rebate
Here is where long-term traders get surprised. Take the 0.10 lot long example above, held for four weeks:
| Cost or credit | Amount (illustration) |
|---|---|
| Spread of 1.0 pip, paid once | −$1.00 |
| Swap, 28 charges | −$19.60 |
| Cashback at $3 per lot, 0.10 lot round trip | +$0.30 |
For a swing trade, swap can be roughly twenty times the spread, and a rebate barely moves the total. Rebates pay per lot traded, so they matter for active traders who open and close many lots, not for one long hold. Be wary of anyone who says cashback “covers” overnight costs. To compare spread and commission between accounts, use the spread and commission calculator; for rebates, the forex rebate calculator.
Estimating a Percent-Based Swap
Some brokers quote swap as an annual percentage instead of points. The arithmetic is still simple. Illustration: a 0.10 lot EUR/USD position has a notional value of about $10,800. If the effective annual charge after markup is 2.5%, one night costs about $10,800 × 2.5% ÷ 360 = $0.75, and a triple night about $2.25. Over a 30-night hold with weekends included that is roughly $22.50. Whichever format your platform uses, convert it to money per night before you open a position you plan to keep.
Swap-Free Accounts
Islamic or swap-free accounts remove interest-based swap. Some brokers replace it with a fixed administration fee after a number of nights, wider spreads or limits on which symbols qualify. Read the conditions before choosing one only to save cost. We cover this in detail in swap-free Islamic forex accounts.
Swap Checklist Before Holding Overnight
- Open the symbol specification and note swap long, swap short, swap type and the triple day.
- Convert to money for your lot size and the number of nights you expect to hold.
- Compare that with your target profit. If swap eats more than 10% to 20% of the target, reconsider the hold or the direction.
- Avoid opening a marginal trade just before the triple swap rollover.
- Re-check rates after central bank decisions; they can flip from credit to debit.
- Remember swap is booked to balance each night and lowers equity and free margin.
Common Misconceptions
- “Positive swap is free money.” Carry credits are small compared with normal price moves; a few pips against you erase weeks of credit.
- “Swap is the same at every broker.” Markups differ, so compare real figures.
- “Leverage changes swap.” It does not. Swap depends on lot size and nights held. See leverage for beginners.
Related Guides
This guide is part of our Trading Costs and Rebates series. For the full overview, start with Brokers With Rebates, then continue with:
- what a spread is in forex
- pips and pip value
- CFD costs and brokers
- zero spread accounts
- forex scalping
Key Takeaways
- Swap is the overnight interest adjustment on positions held past rollover; it can be a credit or a debit.
- Read swap long, swap short, swap type and the triple day in the symbol specification.
- Most forex pairs charge triple swap on Wednesday; other CFDs may use a different day.
- For multi-week holds, swap can be far larger than the spread and any rebate.
- Swap-free accounts may replace swap with other fees; read the terms.
FAQ
What is swap in forex?
It is the interest charged or paid for holding a position overnight, based on the interest rate difference between the two currencies plus the broker markup.
Why are both swap long and swap short negative?
The broker markup is larger than the interest rate difference, so both directions pay.
What time is the forex swap charged?
At the daily rollover, commonly around 5 pm New York time. Your platform server time may show it as midnight.
Why is swap tripled on Wednesday?
Because of the two-day settlement cycle, Wednesday positions settle across the weekend, so three days are charged at once.
Do rebates offset swap?
Rarely. Rebates are paid per lot traded, so a single position held for weeks earns the rebate once while paying swap every night.
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For the wider picture of how spreads, commissions and swaps add up over a month of trading, our sister site leaksfx.com has a separate cost breakdown.
Risk Disclaimer: Trading forex and CFDs carries a high level of risk and may not be suitable for all investors. You can lose all the money you deposit. JFRebate earns a referral commission from brokers it reviews; this never changes the spreads you pay. This article is for information only and is not financial advice.
Om Erick, CTA, is a Certified Technical Analyst and a forex trading veteran active since 2010, recognized as one of the Top 35 Best Traders in the World (MQL5, 2024). As the author of “Belajar Trading dari 0” and “Psikologi Trading,” as well as an active Psychological Trading Coach, Om Erick is dedicated to providing objective, data-backed trading guidance. Through JFRebate, he helps traders achieve peak performance by providing access to trusted brokers and a transparent, industry-leading rebate system.