2023Q1 Rollover Ranking and Interest Rate Trends
The monetary policies vary by country, and the interest rate differentials are reflected directly in the trades. Z.com Forex provides ultra competitive rollover rates, and all positions held overnight will incur rollover. In 2023Q1, as the interest rate differences have continued to widen, in addition to the leverage factor of forex trading, by holding 1 lot buy USD/JPY, with a required margin of HKD 3,925, the average daily yield from rollover was HKD 10.26. The chart below shows the rollover statistics from 2023Q1.
The chart above shows the daily average figures for Jan to Mar 2023, with USD/JPY ranked highest, followed by USD/CHF. The top ranked currency pair, USD/JPY, has on average yielded HKD 10.26 per lot per day.
The chart above shows that since 2022, the U.S. has constantly increased the interest rates from near 0 to 4.8%, while Japan and Switzerland have maintained loose interest rate policies, leading to higher rollover rates.
Top 2 Rollover Ranking
Required Margin1
of Approx. HKD 3,925
Daily Rollover2
of HKD 10.26 Per Lot
Total Yield from Jan to Mar
of HKD 923.02
In 2023Q1, as several countries have began raising the benchmark interest rates, Japan continued to maintain an ultra low interest rate of -0.1%, while the U.S. has steadily raised its rate to 4.8%, leading to a wide interest rate differential between the two countries. As of right now, 1 lot buy USD/JPY requires approx. HKD 3,925 in required margin, and in 2023Q1, the average daily yield was HKD 10.26, or a total of HKD 923.02 if held for the entire period.
Required Margin1
of Approx. HKD 3,925
Daily Rollover2
of HKD 7.96 Per Lot
Total Yield from Jan to Mar
of HKD 716.48
Switzerland continued to maintain its ultra loose monetary policy. In 2023Q1, it has only slightly raised its interest rates by 0.5%, still much lower than its USD counterpart. As of right now, 1 lot buy USD/CHF requires approx. HKD 3,925 in required margin, and in 2023Q1, the average daily yield was HKD 7.96, or a total of HKD 716.48 if held for the entire period.
About Rollover
Why are the rollover rates this high?
- The interest rate differentials continued to widen in 2023Q1
- Japan and Switzerland have maintained low interest rates of -0.1% and 1% respectively while the U.S. has raised to 4.8%, Canada 4.5%, and Eurozone 3.5%
- As the JPY interest rate is very low compared to the USD, buying USD/JPY can be seen as borrowing JPY at a low interest rate to buy a high yielding USD to incur rollover
- The increase in interest rate differentail has enhanced the effect of carry trade
How to receive rollover?
- At 6 am HKT (U.S. Winter Time) or 5 am HKT (U.S. Summer Time), all open positions will incur rollover, and all rollover will be reflected in the trading account (details)
All open positions held overnight on Wednesday will be subject to 3 days in rollover (subject to public holidays), as compensation for settlement over the weekend - You will receive rollover by buying the higher interest rate currency, while rollover must be paid by selling the higher interest rate currency
Where to find out the rollover rates?
- Rollover calendar, which shows the historical rollover rates from the previous trading dates
https://forex.z.com/hk/en/forex_trading/rollover_calendar.html
The pros and cons of using leverage forex trading to earn rollover
- Can buy and sell with high flexibility, and without any minimum commitment period
- Forex trading involves leverage (max. 20 times per SFC requirements), and all interest rates and price fluctuations will also be magnified
- Please be aware that you may suffer losses from price fluctuations. The losses may exceed your rollover rate gains, or even your initial margin.
2. Daily average rollover is calculated by the total between Jan to Mar divided by 90 days
All information published should be used for information purposes only and does not constitute any offer or solicitation to offer or recommendation of any investment product.
