why not just take the positive interest side of things with a good trade on a long term basis?
For every 100k lot you have open, you should earn $4.93 per day. 10 lots = $49.30 per day. Not bad for having virtually no risk. You just need to be careful to continuously monitor your losing account and replenish from the winning account so you don't get a margin call. Can you tell us the names of the brokers?
It's not 49$ for 1 100k lot. It's 4.9$ if i'm not wrong.
Sorry, my bad, forgot to move the decimal over one more spot. I just fixed above post. I wish I was correct!
interest free broker
hi all here i have an interest free broker that i use to hedge
Every currency and commodity has a "cost of carry" associated with holding the position for more than one day. It is called "overnight interest" or "premium". In currencies, this cost is a function of the "interest rate differential" of the two currencies that comprise the exchange rate.
For example, in USD/JPY, the interest rate differential is the difference between short-term U.S. interest rates and short-term Japanese interest rates. If, for example, U.S. interest rates are 5.0% and Japanese interest rates are 1.0%, the interest rate differential is 4.0% (5.0% - 1.0%). This means that if a trader was to sell USD/JPY, he would have to pay 4.0% of the notional amount of the contract per year to hold the position. If position quantity is 100,000, the trader would have to pay approximately $4,000 to hold the position for one year. This translates to approximately $11.00 per day for holding the USD/JPY position ($4,000 / 365).
Another thing : It's not true that when the quote moves you can transfert money from your winning accout to your loosing one : doing so you will loose the hedging...
So it's necessary to have the possibility to put more external monney on your loosing account. Also, many brokers don't allow a margin level below 100%, so, to be easy, your two accounts should have three times the used margin. In this case, the return is approx 133% annual with a leverage of 200. Not bad for a zero-risk investment !
hi, I talked to interbank customer service about opening a no swap account ,
they said that I will have to qualify for that . I asked for the qualofication through e-mail. i will post the reply. How about the brokers that you use?