Swap

A swap — also called rollover — is the interest adjustment applied when you hold a trade past the daily rollover time (commonly 5pm New York time). It can be a credit or a charge, depending on the interest-rate difference between the two currencies and which way you’re trading.

Positions held over Wednesday night usually carry a triple swap to account for the weekend. Islamic (“swap-free”) accounts replace swaps with an alternative arrangement.

For short-term day trades that you open and close the same day, swaps usually don’t apply.