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Daily FX Interest?


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Hi all.

 

I am new around here and still getting accustomed to the platform.

 

I have just incurred a daily FX interest charge for 3 days EUR/GPB for £160.00. 

 

What on earth is this charge for?

 

Any information on this is much appreciated.

 

Thanks to all.

 

P.S: Just got another charge for £388.22 for 3 day interest EUR/USD!!! What on earth? from where I'm standing IG are profiting from me more than I am making on my trades. I must be missing something surely!!!

Albert

 

Daily FX Interest for 3 day EUR/GBP  
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Hi , please be advised that any positions on our Spot FX markets will be subject to overnight funding using the relevant TomNext bid/ask prices, plus IG's annual administration charge of 0.8%. All your open FX positions are automatically rolled over to the next settlement date so as to avoid physical delivery of the currencies in question, hence why you'll see interest charges on your account.

This is calculated as Bet size * Relevant TomNext, irrespective of the prices you buy and sell at. The TomNext rate is a tradeable rate in its own right and acts as an interest rate differential between the two currencies you’re trading, and hence can change day on day.

 

Since TomNext operates on a T+2 basis, settlement only takes place two business days after the trade date. Therefore a three-day interest charge will be applied on your positions if you held a position through Wednesday. This is because the delivery date would change from Friday to Monday, which is why the rollover on Wednesday requires three days' worth of interest and not just one day.


For more information, please visit our Help and Support page on the link below where we explain how funding for forex positions is calculated:

https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/fees-and-charges/how-is-funding-on-forex-positions-calculated

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Hi , please be advised that any positions on our Spot FX markets will be subject to overnight funding using the relevant TomNext bid/ask prices, plus IG's annual administration charge of 0.8%. All your open FX positions are automatically rolled over to the next settlement date so as to avoid physical delivery of the currencies in question, hence why you'll see interest charges on your account.

This is calculated as Bet size * Relevant TomNext, irrespective of the prices you buy and sell at. The TomNext rate is a tradeable rate in its own right and acts as an interest rate differential between the two currencies you’re trading, and hence can change day on day.

 

Since TomNext operates on a T+2 basis, settlement only takes place two business days after the trade date. Therefore a three-day interest charge will be applied on your positions if you held a position through Wednesday. This is because the delivery date would change from Friday to Monday, which is why the rollover on Wednesday requires three days' worth of interest and not just one day.


For more information, please visit our Help and Support page on the link below where we explain how funding for forex positions is calculated:

https://www.ig.com/uk/help-and-support/spread-betting-and-cfds/fees-and-charges/how-is-funding-on-forex-positions-calculated

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  • 4 months later...

daily interest on FX is calculated in the following way:

 

Swap Rate x Trade Size

 

...therefore a change in margin deposit required to open a position shouldn't have an effect (assuming all other things are equal). 

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  • 2 years later...
On 18/01/2018 at 17:35, JamesIG said:

 - Further to  post above please find a good break down of how this is calculated at the following link. The thread is now closed  but if you have any questions please simply comment below :) 

 

https://community.ig.com/t5/IG-Trading-Support-and/Last-night-s-funding-costs/m-p/18239/highlight/true#M463 

@JamesIG  - I would like to understand the break down of how this is calculated. Do you have a copy of this now closed thread?

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