Swap - The Real Deal!

[Sledge]

Quick def: if you hold a position past closing you get "Swap" money deposited into your account, sometimes called Rollover as well.

Ok, at one time I had two brokers and would watch this fleecing of my account.

I'd place 1 (2.00) GBP/USD LONG order on 1 broker and 1 LONG on another:

Broker A would TAKE approximately $5 from me at the end of the day.
Broker B would GIVE me $5 at the end of the day on a 2.00 Lot of GBP/USD

Now yesterday (Monday) I was in a Short position that happened to close out after EOD. My broker TOOK $30 off me on the Swap on a 2.00 Lot.

I have been in this game for a while now and cannot for the life of me figure this out- If I am Short on the pound I EXPECT the interest rate difference of the USD and GBP multiplied by my lot size to be deducted from my account.

If I am LONG- shouldn't the dollar amount of the swap be the SAME?
I.E. If I am short 2 lots of GBP I should get a -$30 Swap
On Day two I am Long- should I not get a deposit of $30?

Seems as if I'm getting hosed- if I'm long I get $5 dollars- if I'm short they take $30- Seems a shady bunch of B.S. if you ask me!

Also in the first example above- the Broker who always took from me on longs and shorts- were cut from my trading life- hard enough to make money in this game without being stolen from also!

[torero]

Welcome to the world of retail forex! This scam has been going on for a while and no regulation budge on protecting traders' rights. Check if you have a dealing desk broker or not. They are like night and day if you want to make money in this game. Hard enough these bucket shops trade against you, worst they find all the reason to drain your account with other methods (they call it FEES). Read the fine print and ask all the questions before funding the account.

Check out this forum:

http://nondealingdesk.com/

I always recommend to newcomers to read this before going further.

[Sledge]

Torero-
Yep, been to the NDD forum. Good group of folks over there. Guess I'm still wondering what the "formula" is that they use to determine their swap $ though.

"Ok every other Wednesday when the moon is in the 3rd house of the sun- on Long orders we will give the traders $17.62. The day after we will give them $1.32 on the same lot amount- sound right?!"

Oy!
Sledge

[torero]

A word of caution: I don't think you should be concentrating on getting interest as a way of making money from forex (banks can give you that but then again, all fees added up + inflation, we're screwed anyway). Finding a profit from speculative trading makes more sense, wouldn't you agree?

[Sledge]

Torero-
Heh, Since I'm not Warren Buffett, I can't afford to hold positions for years to make Swap $ like he does. So to answer: I don't actually like to hold a position that long, but in the cases where it is necessary to hold the position as it did not hit my T/P in the timeframe I hoped, just thought I'd ask why or how they seem to calculate this weird way of giving/taking $ off traders.

As with any trader, I don't make my money off the swap $, I make it off the trade- but I never like anyone taking $ from me that they don't deserve to have

I recently closed 3 bank accounts at a bank I have been with for over 10 years - without hesitation - because they ended up shorting my accounts by $11 with no explination nor ability to justify it.
Sledge

[torero]

I commend on your ability to not withstand these cheatin' varmins. I can't explain these fine prints that explains their justification of their way to calculating interest to your benefit and interest to their benefit. You have to talk to them directly. If they can dupe the smartest of us, then anyone can be a sucker. If you feel insulted by their robbing right in front of you, take that money and go elsewhere. Feeling cheated is not the right frame of mind to trade. Good luck.