SWAP RATES

What is a Swap Rate?

A swap rate is the rate of the fixed leg of a swap as determined by its particular market and the parties involved. In an interest rate swap, it is the fixed interest rate exchanged for a benchmark rate such as LIBOR plus or minus a spread. It is also the exchange rate associated with the fixed portion of a currency swap.

Swap rates are applied to different types of swaps. An interest rate swap is the exchange of a floating interest rate for a fixed interest rate. A currency swap is the exchange of interest payments in one currency for those in another. In both types of transaction, the fixed element is referred to as the swap rate.

Any positions kept open overnight will be subject to financial fees (Swap fees). Depending on the traded product, the volume and the order type (long or short) your trading account will be charged or credited at rollover automatically.

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