Home » Cost of Carry

Cost of Carry

The cost of maintaining a trading position is often referred to as the cost of carry or carrying charge.

It can come in many forms, including interest on margins or the loans used to make the trade or the cost of storage and insurance associated with holding a commodity.

In forex, there are several costs that can arise from keeping a position open.

Changes in interest rates can require a charge on your account, or overnight funding charges can be incurred.

Often, the cost of carry will already be included in the price of opening a new position. Usually, it varies depending on the type of trade and asset being traded.

Related
Monetary Policy

Monetary policy refers to the actions taken by a nation’s central bank to influence the availability and cost of money and credit to Read more

Kathy Lien

Kathy Lien is an expert in global currencies, author, and Managing Director of BK Asset Management. For retail FX traders back Read more

European Parliament

The European Parliament is the European Union’s law-making body. It is directly elected by EU voters every 5 years. It is a Read more

Open Position

An active trade that has yet to be closed.