Swap or Rollover Policy

Swap or Rollover Policy

Trade the forex market with BuzzFx and take advantage of the best trading conditions in the market today!

Definition

Rollover, also known as Swap or Overnight Fee, is an interest paid or earned as a result of holding a position open overnight on a Derivative. BuzzFx Rollover Policy is aimed to establish and maintain a fair fee across all the tradable securities and asset classes.

warren buffett
You know… you keep doing the same things and you keep getting the same result over and over again.

Throughout most of the available securities, apart from Forex, Gold and Cryptos, the rollover fee constitutes of an internal interest fee plus or minus the rollover fee we gather from the counterparties we collaborate with for that respective security. For the remaining instruments, due to their volatility, the final fee also considers an internal market and risk analysis conducted by the company. Rollover fees are assessed on a continuous basis and amended when needed.

PROPER USE

It’s important that our respective clients understand that substantial charges are applied from interbank on Swap Free Accounts and consequently the Swap Free Account is a curtesy from HouseWealth to its clients. Accordingly, open positions will be subject to a daily commission charge after a certain period of days from each position open time to reduce the hefty charge the company incurs on such accounts.

You agree to use each Swap-Free Account in good faith and not to take unfair advantage of its nature or terms or to enter into strategies, including carry trade or arbitration strategies, intended to take advantage of the differences between Swap-Free Accounts and Standard Accounts.

Swap free positions may be carried for 5 days and after the five day period BuzzFx system will start calculating a daily commission on such positions as BuzzFx sees fit taking into consideration risks and market exposure

If you carry out any of the behavior prohibited by the above clause, or we have reasonable grounds to believe you have done so, it will constitute a breach of the Agreement and, in addition to our rights elsewhere in the Agreement, we may:

  • According to the account type; when the margin stop out level specification is reached BuzzFx will liquidate (close) all open position(s).
  • Convert your Swap-Free Account to a Standard Account.
  • Amend any relevant Transaction, so that it is as it would have been if the Order was executed in the absence of the improper behavior.
  • Enforce any relevant Transaction against you if it is a Transaction under which you have incurred a loss.
  • Treat any relevant Transaction as void if it is a Transaction under which you have secured a profit (and retain any such profit for our own account, subject to Applicable Law), unless and until you produce conclusive evidence within 6 months of the Transaction being closed that you have not, in fact, carried out the relevant prohibited behavior
  • If we exercise any of our rights here, and if you have received any monies from us in connection with any associated Transactions, you agree that those monies are due and payable to us and you agree to immediately return an equal sum to us.

Swap Calculation

Rollover Calculation - Example

Rollover Debit Simulation

Account Base Currency: EUR

Security: USA100 (Nasdaq)

Position Size: 1 lot (1 Contract)

Side: Buy (Long)

Currency Rate: EURUSD

Rollover Fee Formula = Position Size * (Counterparty Fee * Internal Interest Fee) * Pip Value) / Currency Rate

Calculation: 1 * (-0.70 * 1.30) * 1.00 / 1.1610 = $-0.78

Rollover Credit Simulation

Account Base Currency: USD

Security: GBPUSD

Position Size: 0.50 Lots (50,000)

Side: Sell (Short)

Currency Rate: USD

Rollover Fee Formula = Position Size * (Counterparty Fee * Internal Interest Fee) * Pip Value) / Currency Rate Calculation: 0.50 * (0.45 * 0.70) * 10.00 / 1 = $1.57

Shares Rollover and Dividend Pay-out

Shares rollover fees are derived from the underlying value of the contract times the interbank LIBOR rates, +/- internal interest fees. The calculation is based upon 365 days of trading for UK shares and 360 for all other offered shares.

Shares Calculation - Example

Share Rollover Simulation

Account Base Currency: USD

Account Quote Currency: USD

Security: FaceBook

Position Size: 1 lot = Contract Size 100 Shares

Side: Buy (LONG)

Share Rollover Formula: (Notional value * (LIBOR +/- Internal Interest Fee))/360)

Calculation: (20,000 * (2.24% + 2.15%) ) / 360 = -$2.44)

Due to a stock share's price adjustment on dividends pay outs, the rollover fee will be adjusted to make up for the correction of the share prices during that day.

The day after the dividends are paid the shares rollover fee usually goes back to the initial fixed rate.

Dividends Calculation - Example

Dividend Adjustment Simulation

Account Base Currency: USD

Account Quote Currency: USD

Security: Goldman Sachs

Position Size: 1 lot = Contract Size 100 Shares

Side: Sell (Short)

Ex-dividend amount: 0.80 USD (per share)

Dividend Adjustment Formula: Contract Size * (Dividend amount * Internal Interest Fee)

Calculation: 100 * (0.80 * -1.30) = -104 USD

Rollover Charging Schedule

The beginning and end of the trading day is considered to be 00:00 by our servers. Any position left open at 00:00 (server time) is considered to be held overnight and is subject to rollover fees. A position opened at 00:01 (server time) is not subject to rollover until the next day, while a position opened at 23:59 (server time) is subject to rollover at 00:00 (server time).

A credit or debit for each position opened at 00:00 will appear in your account, it is applied directly to the trade via the swap field and reflects automatically into your account balance.

Server Times

  • GMT+3: Last Sunday of March to Last Sunday of October
  • GMT+2: Last Sunday of October to Last Sunday of March

Weekends and Public Holidays

Despite markets are mostly closed during weekend and local public holidays, interests remain applicable for positions held during those periods. To measure for this, weekend rollover fees are computed and applied for three days on Wednesdays, which makes a typical Wednesday rollover three times the amount. Please note that for indices instruments triple swap is applied on Friday instead.

Triple Swap - Example

Rollover Credit Simulation for Wednesday

Account Base Currency: USD

Security: GBPUSD

Position Size: 0.50 Lots (50,000)

Side: Sell (Short)

Currency Rate: USD

Triple Rollover Fee Formula = (Position Size * (Counterparty Fee * Internal Interest Fee) * Pip Value) / Currency Rate) * 3

Calculation: (0.50 * (0.45 * 0.70) * 10.00 / 1) * 3 = $4,71

As per the above, rollover fees are also applied as usual for all instruments during public holidays no matter whether the instrument is tradable or not during that day.