Overnight Policy

Dukascopy Bank's Overnight Policy is aimed at providing highly competitive rollover conditions to its clients in order to underline the Bank's leadership in the FX industry. Dukascopy Bank applies different rollover rates to ensure that higher trading turnover for a client results in better overnight conditions.

The rollover conditions applicable to a client's trading accounts are determined dynamically based on the client's Trading Activity. Trading Activity is calculated over the last 30 calendar days across all of the client's trading accounts as the total trading volume divided by the sum of the trading volume and the overnight volume.

Trading Activity reflects the trader's tendency to trade intraday more frequently than to keep positions overnight. Trading Activity is recalculated on a daily basis at the settlement time and the rollover policy is defined according to the percentage levels below:

If no trading statistics are available for the previous 30 calendar days, the Advanced Rollover Policy is applied by default. Clients whose Trading Activity exceeds 90% qualify for the Premium level and the corresponding rollover rates. Clients can view the Rollover Policy currently applied to their accounts in the “Rollovers” report. For more information on how Trading Activity is calculated, see the examples below.

• Examples of Trading Activity calculation

  Example 1

  Over the last 30 calendar days, a client opens six positions with a volume of 1,000,000 each, closes five of them on the same day, and carries one position over to the next trading day.

  Opening trade volume	6'000'000
  Partial closing trade volume	5'000'000
  Rollover open volume for 1 day	1'000'000
  Total trading volume	11'000'000
  Total trading and overnight volume	12'000'000
  Trading Activity: 11'000'000 / 12'000'000 * 100% = 92% Applicable rollover policy: Premium

  Example 2

  Over the last 30 calendar days, a client opens a position with a volume of 1,000,000 and holds it for 9 days before closing it.

  Opening trade volume	1'000'000
  Closing trade volume	1'000'000
  Rollover open volume for 9 day	9'000'000
  Total trading volume	2'000'000
  Total trading and overnight volume	11'000'000
  Trading Activity: 2'000'000 / 11'000'000 * 100% = 18% Applicable rollover policy: Regular

Rollover Procedure

The rollover procedure describes the daily process used to carry existing exposure into the new trading day. This process, also known as a “position roll”, “carry” or “overnight swap”, allows positions that remain open at the end of the trading day to be carried forward without full settlement and delivery.
For most instruments, the trading day changes at 21:00/22:00 GMT, depending on US daylight saving time in March and November. For currency pairs containing NZD, the trading day changes at 19:00/18:00 GMT, depending on New Zealand daylight saving time in April and September. On Fridays, the change takes place at 21:00/22:00 GMT, depending on US daylight saving time.

The end-of-day settlement process takes place at 21:00/22:00 GMT, depending on summer or winter time. For each position that remains open when the trading day changes, the existing position is closed at the settlement price and simultaneously reopened for the new trading day at the settlement price adjusted by the applicable overnight adjustment in pips, as shown in the table. These transactions are recorded as “rollover close” and “rollover open” and can be viewed in the portfolio and intraday statements. Clients can also view the effect of the rollover adjustment in the position report.

Rollover Rate Updates

Overnight swap prices are commonly based on the central bank reference rates shown in the table below. Overnight swap rates change with changes in the interest rate differentials of the two currencies involved. However, Dukascopy Bank updates its own rates on the basis of interbank market overnight swaps.

Dukascopy Bank uses the following central bank target rates as a basis for its overnight policy set-up. It must be stressed that Dukascopy Bank adds its own carry costs to the rates applied to the clients.

Swap-free accounts

Swap-free accounts are trading accounts designed to comply with Islamic finance principles.

The overnight swap cost which is normally charged or credited to client accounts as price difference between rollover close and rollover open trades is not applied to swap-free accounts meaning that both rollover trades are booked at same price. The Client will not be credited nor debited any interest on any open position in their trading account with Dukascopy Bank at the closing of each business day (21:00/22:00 GMT summer/winter time).

In order to prevent abusive use of swap-free conditions and financial damage to Dukascopy, following protection measures are applied:

• In addition to the standard volume commission paid by clients, an additional fee of USD 5 per 1 million USD for currencies and USD 7.5 per 1 million USD for precious metals and CFDs is charged to swap-free accounts
• Dukascopy estimates its financial damage by calculating the difference between the additional commission paid by the client and the swap amount which is not applied to the account due to the swap-free conditions. If the difference is negative (the "Deficit") and the account equity does not fully cover the Deficit Dukascopy will block further trading by closing opened exposures and canceling active pending orders

The Deficit is calculated once a day at settlement time and is applied by adjusting the minimum Stop Loss Level.

The Deficit amount will be debited from the account if:

• the Client presses "Pay Deficit" button in Rollover Policy report
• it becomes greater than the equivalent of 5'000 USD or 10% of the account balance
• the swap-free rollover policy is terminated
• a full withdrawal is made on the account
• the account is to be charged as per maintenance fee policy

The amount of a partial withdrawal may not exceed the difference between the account equity and the Deficit.

In case of a contradiction between the present Swap-Free Account Terms & Conditions and any other contractual arrangement between the client and Dukascopy Bank, the present Swap-Free Account Terms & Conditions shall prevail. Dukascopy Bank may change Swap-Free Account Terms & Conditions, decline or cancel the use of swap-free conditions, at its own discretion. Dukascopy reserves the right to debit the Deficit at any time.

Clients with a self-trading account can activate or deactivate the swap-free conditions at any time in the relevant account report, as illustrated below:

   

Settlement Procedure

Settlement activities are performed daily and include all post-trade operations, such as trade settlements, rollovers, volume commissions, daily P&L conversions and other end-of-day adjustments. For information on value dates and overnight positions, please refer to the Rollover Policy. The settlement procedure is performed automatically at 21:00/22:00 GMT in the account's base currency. The account balance is updated daily following settlement. Clients can view their balance history in various reports available through the trading platform or web-based access.