Topic: interest differentials

Is it possible to test for interest differentials between currencies? For eg Euro interest is 5% while JPY interest is 0.25%. This means that if I buy the Euro for JPY, I will be getting 4.75% interest on my whole position, not just the margin. This means that if my leverage becomes 100: 1 I shall be getting 475% of interest alone per year. How do I check this out in fores strategy builder?

Regards

Vivek
India

Re: interest differentials

You can easily set the swap numbers. FSB always reduces your account with the selected Swap Number of pips per each transferred lot.
The default value is 1, but you can increase it if the value of your broker for that currency is greater.

Re: interest differentials

interest charged works both ways. I can pay or gain. can we program two way interest charges. this software seems to only model my paying interest on positions, what about interest I earn, can I put negative  values?

Re: interest differentials

It is the better way. Safety First smile
Make your system profitable and do not worry about your income by the negative Swaps.

Re: interest differentials

I saw you were talking about SWAP, I don?t know what it is, but I always got that when I gain something in my MT4, so this is takindg me off some money, is no really a really big money, but I don?t know if I?m doing something wrong. Can you help me?

Re: interest differentials

Who can explain to me please what is the way to swap, I´m using MT4 platform and I don’t know what is it. Any reply Ill be thankful.

Re: interest differentials

Interest rate differentials or swap numbers help derive the number of pips which are added to the open position at the end of the working day. The number of pips is calculated as the amount in the open account is multiplied by the swap number for the corresponding currency pair and the product is then multiplied by the number of days the position is carried over. The result is then converted to the currency in which the account is opened at the daily close exchange rates.