Interest Rate Rollover

Interest Rate Rollover important when positions open at 5pm EST, there is a daily rollover interest rates that a forex trader either pays or earns, depending on your established margin and position in the market. If you do not want to earn or pay interest on your positions, simply make sure it is closed at 5pm EST, the established end of the forex market day. Since every currency trade involves borrowing one currency to buy another, interest rate rollover charges are an inherent part. Interest is paid on the currency that is borrowed, and earned on the one that is purchased. If a client is buying a currency with a higher interest rate than the one he/she is borrowing, the net differential will be positive – the client will earn funds as a result.