Swap and leverage

Mirko Cerulli 2015.10.21 18:15 #1

Hard to give a unique response.

Basically, assuming we are talking about a True ECN...

Swap rates are set daily by liquidity providers. The retail broker pass them on to customers without mark-up or not (at its discretion).

The same holds true for the leverage: 1:100 by liquidity provider.

So, no matter.

Large size trade gets live trading Swaps and Liquidity providers

Mirko Cerulli 2015.10.21 18:34 #2

Technically these aren't mutually dependent.

Isauro Martinez Tamez 2015.10.26 16:53 #3

Mirko Cerulli:
Technically these aren't mutually dependent.

Thanks for your comment, I mainly made this question because of the cost of money, I mean if I open a standard round lot of 100000 USD and I have a leverage of 1:100 I only need 1000USD so they are borrowing me 99000 USD which interest is charged daily and also charge the difference of rates between the currencies, but if I open the same ammount with a leverage of 1:200 I only need 500USD and they're borrowing me 99500 USD, things change massively if I have a leverage of 1:25 when I need 4000USD and they are only borrowing 96000 so the interest value in money should decrease.

I also understand the values are minimal, but if you multiply them they can impact a portfolio development.

Swaps Machine learning in trading: $500 to $18m in

Enrico Lambino 2015.10.26 18:27 #4

I believe that the leverage does not matter in this calculation. The swap is usually calculated per lot. Using your example, opening 1 lot on a 1:100 leverage is equivalent to 0.5 lot in 1:200. Both would yield the same amount from the rollover rate.

But you may have confused it with margin requirement. You can potentially earn (or lose) greater with higher leverages by further increasing your trade lotsizes since the margin required for higher leverages is lower.

How to calculate leverage Is it possible to Leverage ... 1:100 or

Alain Verleyen 2015.10.29 15:41 #5

Isauro Martinez Tamez:

Thanks for your comment, I mainly made this question because of the cost of money, I mean if I open a standard round lot of 100000 USD and I have a leverage of 1:100 I only need 1000USD so they are borrowing me 99000 USD which interest is charged daily and also charge the difference of rates between the currencies, but if I open the same ammount with a leverage of 1:200 I only need 500USD and they're borrowing me 99500 USD, things change massively if I have a leverage of 1:25 when I need 4000USD and they are only borrowing 96000 so the interest value in money should decrease.

I also understand the values are minimal, but if you multiply them they can impact a portfolio development.

The swap is always calculated on your 100,000 USD position. Doesn't matter the leverage.

Mohammed Abdulwadud Soubra 2015.11.11 07:47 #6

In addition

You can try with two DEMO accounts the same broker, different leverage

Then you will see that the swap / rollover is same