Forex swap calculator

What forex swap is

A forex position is, underneath, a loan in one currency and a deposit in the other. Hold it past the daily rollover (typically 5 pm New York time) and the broker rolls it to the next value date, applying the difference between the two currencies' interest rates. That adjustment is the swap. If you are long the higher-yielding currency the difference can be in your favour; if you are short it, you pay.

Brokers add a mark-up on both sides, so the published rates are less generous than the raw interest difference. It is common for both the long and the short swap on a pair to be negative, meaning you pay to hold either way. Swap rates change with central bank rates and are often updated weekly.

Gold and silver carry a swap too, set by the metal's lending rate against the dollar rather than a central bank rate. The calculator handles them in the same way, using each instrument's quoted digits.

How swap is calculated

Most platforms, MetaTrader included, publish swap in points. A point is the smallest quoted price step: 0.00001 on a five-decimal pair, 0.001 on a yen pair, 0.01 on gold. On most forex pairs that is a pipette, a tenth of a pip.

Swap per night = swap points × point size × contract size × lots, converted into your account currency.

For one standard lot of EUR/USD that is points × 0.00001 × 100,000 = points × $1. For USD/JPY it is points × 0.001 × 100,000 = points × ¥100, which at 150.00 is about $0.67 per point. The calculator takes the pip value from the same table as the pip value calculator and divides it down to a point, then converts it to your account currency with the price you enter.

Total swap = swap per night × (nights held + 2 × Wednesday rollovers)

The "+ 2" is the triple swap: forex trades settle two business days after the trade date, so a position rolled on Wednesday night settles across the weekend and is charged for Saturday and Sunday as well. Some brokers apply the triple day on Friday for metals, indices or crypto. The contract specification states which.

A worked example

The calculator's defaults, with hypothetical swap rates: 1 standard lot of EUR/USD on a US dollar account, swap long −7.2 points and swap short +2.1 points, held from Monday to Saturday morning (5 rollovers, one of them Wednesday).

1. Value of one point: 0.00001 × 100,000 × 1 lot = $1.00.
2. Swap per night (long): −7.2 × $1.00 = −$7.20.
3. Nights charged: 5 + 2 for the Wednesday triple = 7.
4. Total (long): 7 × −$7.20 = −$50.40, the same as 5 pips of price movement against you.
5. The same trade short: 7 × +$2.10 = +$14.70 credited.

On a trade aiming for 30 pips, a week of long swap at that rate gives back a sixth of the target. Held for a month (about 22 rollovers, four of them Wednesdays, so 30 charged nights) the long swap would reach −$216.

Yen pairs, crosses and gold

The value of a point depends on the instrument, which is why the same swap figure costs different amounts on different pairs.

• Yen pairs: one point on 1 lot of USD/JPY is ¥100. At a price of 150.00 that is $6.67 for a 10-point swap on a dollar account, a third less than 10 points on EUR/USD.
• Gold: gold is quoted to two decimals, so a point is 0.01 and one lot (100 ounces) makes it $1 per point. A hypothetical swap long of −50 points on 0.5 lots costs $25 a night, and $175 over a week that includes a Wednesday.
• Crosses: on a pair such as EUR/GBP the swap is worked out in the quote currency (pounds) and then converted. If your account is in neither currency, the calculator asks for the conversion rate.

Gold swaps on the long side are often large and negative, because holding gold means borrowing dollars against an asset that pays no interest. On a multi-week gold position the swap can be a meaningful share of the expected move, so check it before holding a gold trade for longer than a few days.

Using swap in practice

Read the rate on the day. In MetaTrader, right-click the symbol in Market Watch and open its specification to see "Swap long" and "Swap short" and the swap type. If it says the swap is in money or as an annual percentage rather than in points, convert before using this calculator.

Match the swap to the holding period. An intraday trade closed before the rollover pays no swap at all. A swing trade held for weeks can pay more in swap than in spread. The lesson on trading costs puts swap next to spread and commission.

Do not trade for the swap alone. Holding a position because it earns a positive swap (the "carry trade") exposes you to the full price risk of the pair. A few pips of adverse movement wipes out weeks of credit, and swap rates can turn negative when central banks change course.

Swap-free accounts. Many brokers offer swap-free accounts, often called Islamic accounts, for traders who cannot pay or receive interest for religious reasons. Instead of a swap they may charge a fixed holding fee after a number of days, widen the spread, or limit the instruments available. Terms vary, so read the broker's conditions rather than assuming a swap-free account is cheaper to hold.

Include it in your sizing. If a trade will be held for days, add the expected swap to the money at risk you planned with the position size calculator, or check the full result with the profit calculator and subtract the swap.

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