collapse

Author Topic: Swap rates for long term strategies  (Read 435 times)

Online diyforexskills

  • Verified Vendor
  • Sr. Member
  • ***
  • Posts: 1454
Swap rates for long term strategies
« on: May 17, 2019, 02:59:26 AM »
A lot of comments are made about which broker has the best spreads. Important issue for scalpers. But not so important for long term trading.

For long term strategies, where trades can last many tens of days, large negative swaps are a far more important issue.

And when you make some comparisons, the differences can be huge as shown in the image. The best of the seven analysed for the pairs shown is GoMarkets with whom you would lose the least from negative swaps. The worst is Global Prime followed closely by Darwinex where your profits would be eroded by the large negative swaps.

Interestingly all seven brokers have negative swaps for both Buys and Sells for AUDNZD; and Tickmill has positive swaps for both Buys and Sells for AUDJPY. Wish they were all like AJ.

Brokers might say that the swap rates are outside of their control because they are set by the liquidity providers (LPs). To which the answer would be, renegotiate and/or change LPs. Synergy did that when challenged and are now quite reasonable. Guess we just need to challenge the others.
Information and product page - http://www.diyforexskills.com/forex-tools/




Offline drunkfx

  • Sr. Member
  • ****
  • Posts: 728
Re: Swap rates for long term strategies
« Reply #1 on: June 03, 2019, 07:55:42 AM »
Thanks, have you tried to trade swap arbitrage with any of these broker? I want to try it combining opposite positions on Tickmill and Hotforex, hope they won't ban me quick.

Online diyforexskills

  • Verified Vendor
  • Sr. Member
  • ***
  • Posts: 1454
Re: Swap rates for long term strategies
« Reply #2 on: June 04, 2019, 08:24:14 AM »
Never tried arbitrage trading. Good luck.
Information and product page - http://www.diyforexskills.com/forex-tools/




Offline drunkfx

  • Sr. Member
  • ****
  • Posts: 728
Re: Swap rates for long term strategies
« Reply #3 on: June 04, 2019, 05:11:51 PM »
Can you please describe your strategy in more details? Are you selling it or simply want public discussion about your trading approach?

Online diyforexskills

  • Verified Vendor
  • Sr. Member
  • ***
  • Posts: 1454
Re: Swap rates for long term strategies
« Reply #4 on: June 05, 2019, 07:31:18 AM »
I am mindful that this is a thread on Brokers.

And so my interest in posting here was to see who else is aware of how poor swaps can be with some brokers and to see which brokers they use for when they do long term strategies - ie ones that are open for days or even weeks.

Brokers make money from people who trade a lot, ie short term strategies, and hence compete and market themselves for their tight spreads; and never saying anything about their swaps, which are set by the liquidity providers.

It seems that small brokers like Global Prime and Darwinex, can't negotiate good swaps because of their size/volume. Which makes them a poor choice for traders using long term strategies - swaps can easily consume 10 to 25% of your profits as I am finding.

(I would love comments/discussion on my strategies which I write about in the Autotrader thread https://donnaforex.com/index.php?topic=12561.msg387738#new    Often leads to new ideas which I can then explore with the Autotrader.
Information and product page - http://www.diyforexskills.com/forex-tools/




Online diyforexskills

  • Verified Vendor
  • Sr. Member
  • ***
  • Posts: 1454
Re: Swap rates for long term strategies
« Reply #5 on: June 06, 2019, 08:13:14 AM »
I am mindful that this is a thread on Brokers.

And so my interest in posting here was to see who else is aware of how poor swaps can be with some brokers and to see which brokers they use for when they do long term strategies - ie ones that are open for days or even weeks.

Brokers make money from people who trade a lot, ie short term strategies, and hence compete and market themselves for their tight spreads; and never saying anything about their swaps, which are set by the liquidity providers.

It seems that small brokers like Global Prime and Darwinex, can't negotiate good swaps because of their size/volume. Which makes them a poor choice for traders using long term strategies - swaps can easily consume 10 to 25% of your profits as I am finding.

(I would love comments/discussion on my strategies which I write about in the Autotrader thread https://donnaforex.com/index.php?topic=12561.msg387738#new    Often leads to new ideas which I can then explore with the Autotrader.

It also appears that swap rates change from time to time. eg Global Prime does not look so bad these days. Anyway, I am having a swap filter built into the Autotrader so that we can select to only enter trades when the swap is +ve. Then as long as we are running enough strategies, we will still have plenty of profitable trading and at least we won't see our profits being swallowed up by -ve swap costs.
Information and product page - http://www.diyforexskills.com/forex-tools/




Offline drunkfx

  • Sr. Member
  • ****
  • Posts: 728
Re: Swap rates for long term strategies
« Reply #6 on: June 12, 2019, 04:05:05 PM »

It seems that small brokers like Global Prime and Darwinex, can't negotiate good swaps because of their size/volume. Which makes them a poor choice for traders using long term strategies - swaps can easily consume 10 to 25% of your profits as I am finding.


Good remark. I wanted to use global prime with Hotforex for swap arbitrage but found that GP swaps are not acceptable (eats almost all profit). Despite of its other strengths I was forced to search for other second broker for my strategy.

 

browse forum

* Recent Posts