We would like to take an opportunity to better explain how our swaps work:
Our MT4 is configured to roll (T+2) FX pairs by 1 day on a Monday, Tuesday, Thursday and Friday and roll by 3 days on a Wednesday. This is to reflect how the value date of an FX position rolls in the underlying market. For example:
Example 1:
Today is Monday. EURUSD value date is Wednesday. At 5 pm NY time (9 pm GMT) tonight EURUSD’s value date will roll from Wednesday to Thursday which is 1 calendar day. Hence the roll on a Monday in our MT4 is always set to 1 day. The swap value we need to charge in this example is 10 MT4 points (10 per day). Therefore, we quote “10” in our swaps and rollover page as MT4 knows that on a Monday it will charge 1 times the value we input. 1 * 10 = 10
Example 2:
Today is Wednesday. EURUSD value date is Friday. At 5 pm NY time (9 pm GMT) tonight EURUSD’s value date will roll from Friday to Monday which is 3 calendar days. Hence the roll on a Wednesday in our MT4 is always set to 3 days. The swap value we need to charge in this example is 30 MT4 points (10 per day). We quote only “10” in our our swaps and rollover page as MT4 knows that on a Wednesday it will charge 3 times the value we input. 3 * 10 = 30
In the event of a holiday
In the event of a holiday the value date rolls in line with market convention. For example:
Today is Wednesday. We’ll pretend there is a holiday on Monday. EURUSD value date is Friday. At 5 pm NY time (9 pm GMT) tonight EURUSD’s value date will roll from Friday to Tuesday (it can’t roll to Monday as Monday is a holiday) which is 4 calendar days. The swap value we need to charge in this example is 40 MT4 points (10 per day). We quote “13.33” in our swaps and rollover page as MT4 knows that on a Wednesday it will charge 3 times the value we input. 3 * 13.33 = 40