Rollover

Introduction

If you’re just starting out in trading, you’ll come across the term rollover pretty quickly, especially if you’re active in forex or crypto markets. In simple terms, rollover refers to what happens when you keep a trading position open past the end of the trading day. While it might sound technical, understanding rollover is essential for anyone wanting to trade currencies or contracts over several days, rather than closing everything before the market shuts. Let’s walk through the basics of rollover, its importance, how it works, and how it can impact your actual profit and loss.

The Core Concept of Rollover

What is Rollover in Trading?

Rollover is what happens when you hold a position open overnight. In forex (where currencies are traded in pairs) and in some crypto platforms, trades are executed on a spot basis—technically meant for settlement within one or two days. But most retail traders, like those using platforms such as TradeLocker, aren’t interested in physical delivery of Euros, Dollars, or Bitcoin. They just want to capture price movement. As a result, your broker extends your open position every day you hold it. This process of moving your trade forward by a day is known as rollover.

For each day you hold an open position past the market’s “settlement” time (usually around 5 PM New York time for forex), your broker will either credit or debit your account with an amount called the swap fee or rollover interest. This is the cost—or sometimes the benefit—of holding onto your trade overnight. You can learn more about swap fees here.

Why Does Rollover Happen?

Unlike a regular stock purchase where you can simply own the shares, many leveraged products (like forex pairs or crypto contracts) use borrowed money. Part of the trading environment assumes you are lending and borrowing currencies from the market. Because interest rates between currency pairs or assets differ, brokers (or the underlying market) settle up the difference each day a position stays open. That’s where the rollover comes in: it’s a nightly calculation for those who don’t close their trades.

How Rollover Is Calculated

Interest Rate Differentials and Swap

When trading currency pairs, rollover is mainly determined by the difference in interest rates between the two currencies. Let’s say you’re trading EUR/USD (euro against the US dollar). Each country’s central bank has its own interest rate. If you go long (buy) EUR/USD, you are buying euros (and earning the euro interest rate), while selling US dollars (paying the dollar’s interest rate). The net difference between these two rates determines whether you pay or receive rollover interest.
Rollover is also referred to as the “swap” in your trading account’s statement. If the currency you are buying has a higher overnight interest rate than the one you’re selling, you may get a small credit each day. But if it’s lower, you’ll usually pay a fee.

The actual amount you pay or receive is influenced by your broker’s policies, market conditions, and the size of your position. On top of that, weekends and holidays can play a role, since rollover is typically tripled on Wednesdays to account for the following weekend. You can see how these trading essentials play out on TradeLocker’s trading features.

Rollover in Crypto Markets

While traditional forex pairs have clear interest rate differentials, crypto rollover works a bit differently. Most platforms apply a holding fee, sometimes called a funding or overnight fee, because these markets run 24/7. The concept is similar: it’s a charge (or potential payout) for holding a leveraged position overnight, reflecting borrowing costs and sometimes the balance between buyers and sellers. More volatile markets can have higher overnight fees, so staying on top of these charges is key for crypto traders.

Why Rollover Matters for Beginners

Impact on Profits and Costs

For traders new to forex or leveraged crypto, rollover charges might seem small, maybe just a few cents per lot per day. However, over weeks or months, especially if you trade on margin or with large positions, these daily fees can add up and make a noticeable dent in your results.

Imagine you’re holding a EUR/USD trade and paying $2 per day in rollover. Over a month, that’s $60—enough to wipe out the small wins of a scalper or someone trading in and out of positions every few days. On the other hand, if your position earns a positive rollover because of a favorable interest rate, it’s like collecting a tiny dividend daily, which can slightly boost your total return.

That’s why it’s important to check the overnight fees for your planned trades and adjust your strategy if needed. Some traders even design “carry trade” strategies, intentionally seeking positive rollover by buying currencies with higher interest rates and selling those with lower rates.

Real World Example

Let’s say you’re trading on TradeLocker and open a position to Buy $10,000 worth of USD/JPY. The US dollar interest rate is higher than the Japanese yen’s rate. If you keep your position open overnight, you may receive a credit of $1.50 daily. Hold that position for 10 days, and you’d get $15 added to your balance (assuming rates and fees don’t change).

Now, imagine you switched the pair and went long on EUR/USD instead. You might instead pay $2.00 per night, ending up with a $20 cost for holding your trade a bit over a week. For more on how these fees compare to other trading costs, check our broad overview of trading fees.

How to Check and Manage Rollover

Where to Find Rollover Charges?

Most trading platforms, including TradeLocker, display rollover fees in your instruments list or in your account statement. On TradeLocker, you may see these as “swap” charges or overnight financing fees attached to each trade. You can track your history, analyze how much you’ve paid or earned, and adjust trading times or position sizes to manage the cost better. Learn more about viewing instrument details on TradeLocker here.

Tips for Managing Rollover

• Plan your trades: If you only want to avoid rollover, close positions before the trading day ends. This approach is common with day traders and scalpers.
• Factor fees into your strategy: For swing and position traders who keep trades open for days or weeks, always check rollover costs alongside spreads and commissions.
• Consider positive rollover: Sometimes, trading in the direction of positive interest differentials can benefit your bottom line with small but cumulative overnight credits.

Every trader finds their own balance between trading style and rollover exposure. Those focusing on short-term moves can usually ignore these costs, but if you keep trades open longer, rollover is a key factor in your overall performance.

Rollover vs. Other Trading Fees

Comparing Rollover to Swaps, Spreads, and Commissions

Rollover is just one type of trading fee. Here’s how it compares to others you’ll encounter:

Unlike spreads or commissions that apply only when you buy or sell, rollover happens every night your position is open, regardless of price movement.

Conclusion: Rollover Is Simple, but Important

At first glance, rollover might seem like a background detail—a small fee or credit that happens quietly at the end of each trading day. But as you deepen your trading journey, it becomes a real part of your strategy. If you trade only for minutes or hours, you’ll rarely deal with rollover. If you hold positions overnight or longer, it’s worth understanding how much it costs, when you might get paid instead of paying, and how your trading style interacts with these nightly adjustments.

By keeping rollover in mind and using TradeLocker’s trading features to monitor your trade costs, you’ll make better decisions about when and what to trade. As you grow as a trader, you’ll start to spot the links between rollover, interest rates, and long-term trading profits—an important milestone for any aspiring forex or crypto trader.

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