How are swap rates calculated on an Australian trading account?
Verdict
- On an Australian forex account, the swap is the overnight interest charge or credit for holding a leveraged position past the daily rollover, worked out per lot from the two currencies' interest rates plus the broker's charge. We recommend Pepperstone, which shows each instrument's swap in its platforms' contract specifications.
- The formula: swap per night = lots x swap rate in points x value of one point, converted into your account currency.
- Most brokers charge three nights' swap on one weekday to cover the weekend; check which day on your platform.
- Pepperstone does not offer swap-free accounts to Australian residents, and its perpetual CFDs use a daily funding charge instead of a swap.
Swaps are the cost most traders ignore until a position has been open for a fortnight. They are not mysterious: each one is an interest calculation, and your platform shows the inputs. Here is how to read and calculate them on an Australian account.
Where to find the swap at Pepperstone
At Pepperstone Group Limited (ASIC, AFSL 414530) the swap for each instrument appears in the platform: right-click a symbol in MT4 or MT5 and open its specification to see swap long and swap short, or check the symbol information panel in cTrader. Rates change as central-bank rates and market funding costs move, so check them on the day you plan to hold. Holding an AUD base currency means the result is converted into dollars for you automatically.
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how is swap calculated in forex
A forex position is, in effect, borrowing one currency to hold another. The swap reflects the gap between their interest rates, adjusted by the broker's own charge, which is why a pair can show a credit on one side and a charge on the other, or a charge on both. Platforms usually quote it in points per lot, and the cost works out as:
- Take the swap rate in points from the contract specification (long or short, as relevant).
- Multiply by the value of one point for one lot in the pair's quote currency.
- Multiply by your position size in lots and by the number of nights held.
- Convert into your account currency at the current rate.
A worked example with an AUD account
This uses an illustrative swap rate, not Pepperstone's current figure. Say the specification shows a long-side swap of minus 5 points on a USD-quoted pair, and one point is worth USD 1 per standard lot. Hold 2 lots for 4 nights including the triple-swap night, which counts as 6 nights of swap: 5 x USD 1 x 2 x 6 = USD 60. On an AUD account the platform converts that into Australian dollars at the prevailing rate. If the same position were short and the specification showed a positive rate, you would receive a credit instead.
| Factor | Effect |
|---|---|
| Position size | Doubles with lots held |
| Nights held | Accrues each rollover, with three nights charged on one weekday |
| Direction | Long and short rates differ; one may be a credit |
| Interest-rate changes | Rates are updated as market rates move |
| Account currency | Converted from the quote currency |
Alternatives if swaps hurt your strategy
- Close before rollover: intraday positions pay no swap.
- Index forwards: Pepperstone offers forwards such as US500-F and AUS200-F, with a fixed expiry and wider minimum spreads (1 and 3 points); read their contract terms on holding costs.
- Perpetual CFDs: on Pepperstone's perpetuals, the holding cost is a daily funding charge at a rate fixed a week ahead.
- Swap-free accounts: Pepperstone offers these only to residents of 23 listed countries, and Australia is not among them.
Sources
Why did I receive a swap credit?
When the currency you hold pays more interest than the one you borrowed, by more than the broker's charge, the swap can be positive.
Do Pepperstone's Razor and Standard accounts have different swaps?
Check the contract specification on each account; Pepperstone publishes the live rates in the platform rather than a fixed table.
Are swaps charged on crypto CFDs?
Leveraged crypto CFDs held overnight carry a financing charge too; check each coin's long and short rate in the contract specification.
Overnight charges add to the risk of holding leveraged CFD and FX positions, which can lose money quickly. The example uses illustrative numbers. Check live rates in your platform; this page is general information, not advice.