Please be informed that effective DAY,MONTH DAY, YEAR the Interest Rates for currencies and Loco will change/ remain as followed:
|CURRENCY||BUYING POSITION||SELLING POSITION|
Forex Swaps are a regular tool used by banks and financial institutions in the course of business. Such transactions however could also be used to maximize the utility of money capitalizing on the interest rate differentials affecting the different currencies.
A typical Swap involves two parts, a spot transaction to acquire the currency desired and a reversed forward transaction to revert back to the original currency. The complexity as such mainly limits the use of swaps to banks and other financial institutions that regularly take advantage of the differences in interest rate differentials.
The Swap facility of Maxco Trader is a natural feature of deferred Spot FX trading, in buying one currency against another a trader either gains or is penalized by the prevailing interest rates between the two currencies. Thus if you bought a currency with higher interest rates than that you sold the net effect would be for you to gain on the differentials and vice versa. Given the level of leverage available a trader could also get interest gains as a multiple of his capital.