Rollover (Swap)

Rollover – In forex, rollover (also known as swap) is the process of extending an open position to the next trading day, which incurs an interest payment or credit based on the interest rate differential of the currency pair. In practical terms, if you hold a position overnight, you either pay a fee or earn a small amount – this is the swap. Backtesting a forex robot should include swaps if positions are held beyond the trading day. A positive swap means the strategy earns a little for holding the trade (if the currency you bought has a higher interest rate than the one you sold), whereas a negative swap means it pays a fee overnight. Swaps can affect the long-term profitability of strategies that hold trades for many days.

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