Why are swap rates among brokers vastly different? | Forex Factory

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Why are swap rates among brokers vastly different?

  • #1
  • First Post: Edited 4:39pm May 12, 2017 5:47am | Edited 4:39pm
I was looking at this
http://www.myfxbook.com/forex-broker-swaps

Why are swap rates among brokers so vastly different?
I.e.
For Long EURUSD:
High is like -3.70 pips (InstaForex)
Low is like -0.06 pips (Oanda)
There are also some brokers that pay you interest instead.

Does that make one broker more expensive than the other when you have to hold overnight?
It is also multiplied by the number of days.

Swap rate is also being applied base on sever time.
I.e. if you long EURUSD at 2359hr, you would be charged a minute later.

Some brokers even have -ve swap rate on both long and short position of the same pair.
What are the justification?

Can they change the swap rate anytime to screw the client.

How did they came out with their swap rate anyway?
  • #2
  • May 12, 2017 6:46am May 12, 2017 6:46am
Quoting johnnybegood
I was looking at this http://www.myfxbook.com/forex-broker-swaps Why are swap rates among brokers vastly different? Does that make one broker more expensive than the other when you have to hold overnight? Can they change the swap rate anytime to screw the client. How did they came out with their swap rate anyway?
I looooove this question johnnybegood!!!!! Will be following this thread closely.

The why, I don't know, but you can always see the swap they are charging you at any given moment in your MT4 (Market Watch | currency | Specification), this bit of info is INVALUABLE if you are trading long term positions.
  • #3
  • May 12, 2017 7:23am May 12, 2017 7:23am
It is a money making scheme......
Never Ever Give Up!
  • #4
  • May 15, 2017 12:30am May 15, 2017 12:30am
welcome to the wild west of spot forex trading.
the brokers can charge you anything they want.
for long-term trading, the costs of trading spot forex is simply too high.
  • #5
  • May 15, 2017 12:48am May 15, 2017 12:48am
Why, because it's mostly unregulated. Choose a broker that most accurately reflects the differential. The timing of the rollover is dependent on the location of the broker as it ties into the end of the USA session.
  • #6
  • May 15, 2017 12:52am May 15, 2017 12:52am
Quoting yonnie
welcome to the wild west of spot forex trading. the brokers can charge you anything they want. for long-term trading, the costs of trading spot forex is simply too high.
Only if you hold positions overnight that balance against you. Holding the other way earns you the rollover and can contribute as a nice bonus. This isn't always possible of course but there are ways to manage it.
  • #7
  • May 15, 2017 1:21am May 15, 2017 1:21am
Yes you are right, brokers have different swap pricing model. And since you are referring to oanda, may I point out to you that oanda charges swap based on the duration you held on to the trade. Therefore there is no daily rollover like many other brokers but swap charges will be levied slowly as the time goes by (e.g. Every 1hour after you open your trade...so charges incur even though you did not hold the trade overnight)
Or if you really do not believe in paying swaps, you may try to obtain a Islamic account...not sure how you can do that that though :/
Searching for some order in these apparent chaos...
  • #8
  • May 15, 2017 2:29am May 15, 2017 2:29am
Quoting EcoTrader
{quote} Only if you hold positions overnight that balance against you. Holding the other way earns you the rollover and can contribute as a nice bonus. This isn't always possible of course but there are ways to manage it.
even if you earn swap on your position with a forex broker, it will be a lot less compared to currency futures.
  • #9
  • May 15, 2017 3:11am May 15, 2017 3:11am
Quoting yonnie
{quote} even if you earn swap on your position with a forex broker, it will be a lot less compared to currency futures.
+1 (not everyone can afford to trade futures though)
  • #10
  • May 16, 2017 7:09am May 16, 2017 7:09am
Quoting johnnybegood
I was looking at this http://www.myfxbook.com/forex-broker-swaps Why are swap rates among brokers so vastly different? I.e. For Long EURUSD: High is like -3.70 pips (InstaForex) Low is like -0.06 pips (Oanda) There are also some brokers that pay you interest instead. Does that make one broker more expensive than the other when you have to hold overnight? It is also multiplied by the number of days. Swap rate is also being applied base on sever time. I.e. if you long EURUSD at 2359hr, you would be charged a minute later. Some brokers even...
how many days do you hold your trade open position on average?
This is not investment/trading advise. Will not hold accountable for loss
  • #11
  • Edited 4:50pm May 17, 2017 4:35pm | Edited 4:50pm
brokers can increase the swap rate for people who are successful trend followers

i am buying and holding GBP/AUD and my broker has been increasing the swap rate to go against me because I am not a scalper who loses money lol

my friend has an account with the same broker and his swap rate is less

time for me to change my broker to Oanda and trade there

http://www.dailyforex.com/forex-arti...ing-edge/30702
Don't Worry Be Happy
  • #12
  • May 17, 2017 5:22pm May 17, 2017 5:22pm
Quoting MrPresident
brokers can increase the swap rate for people who are successful trend followers i am buying and holding GBP/AUD and my broker has been increasing the swap rate to go against me because I am not a scalper who loses money lol my friend has an account with the same broker and his swap rate is less time for me to change my broker to Oanda and trade there http://www.dailyforex.com/forex-arti...ing-edge/30702
That is interesting finding. Thanks for sharing
This is not investment/trading advise. Will not hold accountable for loss
  • #13
  • Last Post: Feb 14, 2020 5:06pm Feb 14, 2020 5:06pm
I use Blueberry, I think they are a good broker, but the way they value swaps doesn't seem fair at all. The 2nd day is always less then the first, or 'more' assuming you are holding negative interest on your pair. Plus on larger lots the ratios seems to be completely reduced to suit the broker so any chance of a carry trade is impossible and swaps just become slight inconveince that is better to, but very difficult, to ignore.
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