How Does This Affect Your FX Trading Account?

If you are long the currency bearing the higher interest rate then you should earn interest, automatically credited to your trading account. Conversely, if you are short the currency bearing the higher interest rate then you should experience a small debit to your account.

Be aware that most foreign exchange brokers require a 2% margin set for your account in order to receive interest. If not, you will have to pay for the rollover, it doesn't matter whether you are long or short the currency bearing the higher interest rate .

Day Traders

For day traders, who almost never hold any overnight positions, the rollover is not applicable because there are no positions to roll, and therefore no interest is earned or paid.

Swing Traders

If you are a swing, position or long term trader, the rollover will affect your account since you'll earn or pay interest on a daily basis. Therefore, it is recommend setting your account at 2% margin and only trying to long the currency bearing the higher interest rate.

A strategy for the longer term trader is the carry trade, which relies on a big interest rate differential between the two traded currencies.