How are fees calculated on the transfer of an open position for the next day and what does “current interest rate differential between traded currencies” mean?
The fees incurred on the transfer of an open position for the next business day are the interest rate currency differential of the quoted currency pair. The current interest rate differential is determined as the difference in the interest rates of traded currencies and is displayed as a swap number because it is either added or deducted from their closing quote at midnight local time. To get a detailed explanation and an example go to Frequently Asked Questions – Accounting Issues.
