Beginners Guide: How to Calculate Swap(Interest Charge) on FX & Gold/Silver with Examples

May 10, 2017

Here, we will explain how to calculate "Swap" with simple examples for beginners.

Beginners Guide: How to Calculate Swap(Interest Charge) on FX & Gold/Silver with Examples

Having trouble calculating “Swaps”?

Once you understand it it is very easy to do. Here, we like to introduce 2 ways of calculating Swaps.
*Wouldn’t bother calculating by yourself? Visit XM Official Website and go to “Research Education”→”Forex Calculators”, where you can use Online Calculator to instantly get results!

Swap Calculation Example ①

Swap = (One Point / Current Exchange Rate) * Trading Volume(in lot) * Swap Value(Points)

Here is an example of Swap Calculation using the above formula.

One Point: 0.00001
Account Base Currency: EUR
Currency Pair: EUR/USD
Current Exchange Rate: 1.0675 (EUR/USD)
Trading Volume in lot: 20 (One Standard Lot = 100,000 Units)
Short Swap Rate: 0.25

⇩ ⇩ ⇩ ⇩ ⇩

Swap Value = (0.00001 / 1.0675) * (2,000,000 * 0.25)
Swap Value is €4.68

*The example is for Short Positions(sell positions). In case it is a long position, then “Long Swap Rate” will be applied.

Swap Calculation Example ② -Simpler One-

Trading Volume in lot * Long or Short Rate * Point Size

Here is an example of using the above formula.

1 lot buy EUR/USD
EUR/USD Point Size = 100,000 * 0.00001 = 1
Account Base Currency: USD
Long Swap Rate= -2.54

⇩ ⇩ ⇩ ⇩ ⇩

Swap Value = 1 * (-3.68) * 1
Swap Value is -2.54 USD

*Point size is calculated by “contract size of a symbol * minimum price fluctuation”.

Swap Calculation for Gold & Silver

Trading Volume in lot * Long or Short Rate * Point Size

1 lot “Buy” of Gold
Gold point size = 100 * 0.01 = 1
Account Base Currency: USD
Long Swap Rate = -5.42

⇩ ⇩ ⇩ ⇩ ⇩

Swap Value = 1 * (-2.17) * 1
Swap Value is -5,42 USD

What you need to know?

  1. Swap Charge/Credit incurs every night around 00:00 am, but not often precisely on 00:00.
  2. If the result is negative, your account will be debited whereas if it is positive your account will be credited.
  3. “Swap Points” won’t incur if you don’t have an open position at the moment(around 00:00) of Swap, even if you had open positions for the whole day.

Are you bothered to calculate Swaps by yourself?

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