How Forex Swaps & Rollovers Work

Overview

Positions held past 5 PM EST are subject to swap (rollover) rates determined by the interest-rate differential between the two currencies in the pair. Swap rates can be a cost or a credit depending on whether you are long or short the higher-yielding currency, making them especially relevant for swing traders who hold positions for multiple days. Wednesday rollovers are typically triple-charged to account for the weekend settlement gap, so timing your entries around this can save meaningful capital over time. Use our P&L calculator to factor swap costs into your projected returns, and check your broker's live swap table — providers like AvaTrade publish daily rates on their platforms.

Key Takeaways

• Swap rates are derived from the short-term interest rates of both currencies in the pair.
• You may receive a positive swap (credit) when buying the higher-yield currency.
• Wednesday rollovers are typically triple to account for the weekend settlement gap.
• Swap-free (Islamic) accounts are available at most brokers for traders who cannot pay or receive interest.

Practical Tips

• Check your broker's swap table daily — rates change with central bank decisions.
• Carry trades profit from positive swaps but face exchange-rate risk.
• If holding positions for weeks, factor cumulative swaps into your P&L projection.