IBDTrades does not charge a rolling commission. What we do charge is a rollover fee (also known as an overnight swap). The rollover fee is calculated when a trader leaves a position open past 00:00 GMT.
The term “rollover” refers to the interest rate that traders will pay, or receive, on the open positions that are rolled over from one day to the next. Every currency pair has its own interest rate. At the end of every trading day, at 00:00 GMT, the trader will pay or receive the interest rate on the currency pairs they hold.
How does it work?
In the trading market, interest is calculated on a daily basis. At the end of each trading day, at 00:00 GMT, traders can see from their account statement if they were charged or received the rollover fee. On regular weekdays, the rollover rate is charged for the past trading day. As the trading week has five days, on Wednesdays, rollover interest for the next weekend is charged for three days.
The following is a brief explanation of rollover interest:
The interest rate of the main currency is lower than that of the secondary currency.
For Example: EUR/AUD. EUR – Interest rate of 1.25%; AUD – interest rate of 4.50%
The euro is the main currency of the pair and its interest rate is lower than that of the secondary currency, which is the Australian Dollar (AUD).
Buy/Long: When the Trader buys the Euro, he will be charged the rollover fee.
Sell/Short: When the Trader sells the Euro, he will receive the rollover fee.
NOTE: Trade volumes affect the amount of the rollover fee; the larger the volume traded, the larger the rollover fee.
Rollover fees are charged as follows:
- From Sunday night to Monday: regular rollover fee
- From Monday night to Tuesday: regular rollover fee
- From Tuesday night to Wednesday: regular rollover fee
- From Wednesday night to Thursday: rollover fee is charged three times (for Wednesday, Friday, and Saturday)
- From Thursday night to Friday: regular rollover fee
In currency trading, the term slippage refers to the difference between the expected price of a trade and the price at which the trade is actually executed.
If the execution price is better than the price requested by the Client, it is referred to as ‘positive slippage.’ In contrast, if the execution price is worse than the price requested by the Client, it is referred to as ‘negative slippage.’
Please be advised that ‘slippage’ is a normal market practice and a regular feature of the foreign exchange markets under conditions* such as illiquidity and volatility due to news announcements, economic events, and market openings, therefore, trading according to news cannot be guaranteed.
It should be noted that the price at which a trade is executed may vary significantly from the original requested price during abnormal market conditions. This may occur, for example, in the following cases:
a) During market opening times,
b) During news times,
c) During volatile periods where prices may move significantly up or down and away from the declared price,
d) Where there is rapid price movement, if the price rises or falls in one trading session to such an extent that under the rules of the relevant exchange, trading is suspended or restricted,
e) If there is insufficient liquidity for the execution of the specific volume at the declared price
*Please note that this is not an exhaustive list.