How is a forex swap calculated?

July 26, 2016

The swap premium is calculated in the following manner:

Pip Value (Depending On Trade Size) * swap rate in Pips * Number of Nights = Swap charge/credit

Forex Example:
You open a short position (Sell) on EUR/USD for 1 lot with an account based in USD:

1 Lot = 100,000
1 Pip Value = 10 USD
Swap Rate = -3.2839 Points (equivalent to 0.32839 Pips)
Number of Nights = 1
Swap Premium: 10 * 0.32839 * 1 = 3.2839 USD

CFDs Example:
You open a long position (Buy) on Crude oil for 1 lot (1,000 barrels) with an account based in USD:

Swap Rate = -0.3807
1 Cent Value = 10 USD
Number of Nights = 1
Swap Premium: 10 * -0.3807 * 1 = -3.807 USD

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