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Daily Commodities Interest

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Hi all,

I've had an open buy position on US oil for the past few days and have found that there have been daily transactions crediting my account with various amounts, under the description 'Daily Commodities Interest for 1 day Oil - US Crude'. I can't find any info anywhere about this anywhere. What interest rate is this? How would I calculate the amount?

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Hey - you may find the below useful. This should answer your question.

 

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JamesIG,

Thanks very much! I didn't get the exact answer calculating using that formula based on end-of-day prices, but it was close enough to make sense I think.

If I understand correctly, the reason I'm currently being credited is that the October futures price is currently lower than the September futures price. If/when that situation were to flip, my account would be debited every day?

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Or take the other side of the trade @pskeoch - ie short instead of long. 

James will be able to confirm in more detail but these things are known in advance. Some commodities have HUGE carry costs. 

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Hey all - for reference and comparison you can see some other overnight fundings below. As stated this is due to the futures curve, however it also takes into account the IG admin charge. Below positive means you receive, whilst negative means you are debited. 

2018-08-16 10_06_23-Undated Funding Dialog.png

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