Definition
What is Swap (overnight fee)?
A swap is the overnight financing amount charged or credited on a leveraged position held past the daily rollover, based on the interest rate difference of the instrument.
When you hold a leveraged CFD or forex position overnight, you are effectively borrowing one currency to hold another. The swap reflects the interest rate difference between them, plus a markup.
It can be negative (a cost) or positive (a credit), and it is often different for long and short positions. Many platforms apply three days of swap on one weekday to cover the weekend.
For intraday traders swap does not matter. For swing traders holding for days or weeks it is a real cost to include in the plan.
Example
Example: a position with a swap of −$6 per lot per night, held at 2 lots for 5 nights, costs 2 × 5 × $6 = $60, which is 0.6% of a $10,000 account.
At a prop firm
Swap rates on Axora Funded are part of each instrument’s specification on the platform, and under the Axora Funded terms swaps count towards results and loss limits.
Frequently asked questions
Do day traders pay swap?
No. Swap only applies to positions held past the daily rollover.
Is swap the same as commission?
No. Commission is charged per trade; swap is charged per night a position stays open.