Friday 26 April 2019

Using Swap in CFD trading.

Swap in Forex trading is an agreement consists of swapping principal and interest payments in one currency with principal and interest in another currency of a loan of equal value.
Sometimes you may choose to place a trade and carry that for a long time. Maybe to hedge against your other trades.
 To avoid paying extra fees you should choose the right pair. The best and fastest way is by looking into your broker's fees and choose a pair with a positive value for the overnight or swap fees.
The best pairs to swap belongs to a pair which one currency has a  high yielding and the other has a low yielding interest. 
Let’s use the USD and Turkish Lyra: rates in the US are currently below the interest rates in Turkey. This means that there is an opportunity to earn carry buying Turkish Lyra(TRY) with USD ie going short USDTRY.

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