By Approach

How to Journal Carry Trades

Carry trades are held for days/weeks to capture interest rate differentials. Journal the entry setup, holding period, rollover costs, and overnight P&L separately.

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Fields to Track

Entry Date & Price

Marks the start of the hold period. Carry trades can hold for weeks; clear dating prevents confusion.

Exit Date & Price

Marks the end of the hold period. You need to know how long you held to calculate time-based returns.

Currency Pair

Carry trades depend on interest rate differentials. EUR/USD and GBP/USD have different carry values.

Interest Rate Differential

Bid/ask spread depends on this. If AUD rate is 3%, USD rate is 1%, you earn 2% carry (minus costs). Track this.

Overnight Holds (Count)

Carry trades earn (or lose) money when you hold through rollover. Track how many nights you held.

Total Rollover Cost/Gain

Some pairs pay rollover interest; others cost it. Track both. Over 100 trades, this adds up to thousands.

Entry Reason (Fundamental)

Unlike technical trades, carry trades are based on interest rate differentials. Log your fundamental thesis.

Daily Mark-to-Market P&L

Carry trades fluctuate. Track daily changes separately from rollover P&L.

Final Exit Reason

Did you hit a technical target? Was interest rate data released? Did interest rate expectations change?

Sample Journal Entry

Example Entry Carry Trades

**Date:** 2026-04-06
**Pair:** AUD/USD
**Entry:** 0.6750 (Bullish AUD carry; 3.75% AUD rate - 1.25% USD rate = 2.5% carry potential)
**Position Size:** 2 micro lots (20K units)
**Stop Loss:** 0.6700 (technical support)
**Target:** No fixed target (carry trade, hold for interest)
**Overnight Holds:** 5 days
**Rollover Gain:** +$25 (2 micro × $12.50/day × 5 days, minus broker fees)
**Mark-to-Market:** Entry 0.6750 → Current 0.6785 = +$70 (intraday appreciation)
**Total P&L:** +$70 + $25 = **+$95**
**Exit Notes:** AUD RBA signals no rate cuts; positive for carry. Held 5 days as planned.

Review Process

After each carry trade: log entry price, interest rate differential, and planned holding period

During the hold: track daily mark-to-market and any economic news that might affect rates

At exit: calculate total P&L (capital appreciation + rollover interest) and categorize separately

Monthly review: compare carry gains vs. technical entry/exit gains. Where is your real edge?

Quarterly review: which pairs have best carry-adjusted returns? Double down on those.

Journaling Carry Trades: Separating Interest from Movement

Carry trades are fundamentally different from technical trades. You’re not trying to predict a price move; you’re trying to capture the interest rate differential over time.

This requires different journaling.

Why Separate Carry from Capital Appreciation?

Example trade:

Entry: AUD/USD 0.6750
Exit (5 days later): 0.6800
Rollover earned: $50 (interest payments)

Capital gain: 50 pips × $10/pip = $500 Rollover gain: $50 Total P&L: $550

If you just log “$550 profit,” you miss the insight: “Am I profitable because AUD appreciated, or because I’m capturing interest?”

The answer matters. If AUD depreciates next time but carry remains the same, you need to know which edge you actually have.

The Carry Trade Journal Structure

What to Log at Entry

Entry price and date (2026-04-06, AUD/USD 0.6750)
Currency pair (affects interest rate differential)
Interest rate differential (AUD 3.75%, USD 1.25% = 2.5% differential)
Planned holding period (5 days, 2 weeks, 1 month?)
Entry reason (fundamental: RBA hawkish, expect carry gains)
Position size
Technical stop loss (insurance against big moves)

What to Track During the Hold

Daily mark-to-market price (did AUD/USD move up or down?)
Rollover interest earned (your broker credits this daily or at rollover)
Economic calendar events (watch for interest rate announcements)

What to Log at Exit

Exit date and price
Holding period (5 days, 2 weeks, actual duration)
Total rollover earned (cumulative interest)
Capital gain/loss (price appreciation/depreciation)
Exit reason (hit technical stop? Rate decision? Decided to close early?)
Total P&L (capital + rollover)

Real-World Example: AUD/USD Carry

Setup:

AUD interest rate: 3.75%
USD interest rate: 1.25%
Carry differential: 2.5%
On 1 micro lot, monthly carry potential: ~1K units × 2.5% annual ÷ 12 = ~$20/month

Trade entry:

Entry: AUD/USD 0.6750
Position: 5 micro lots (5K units)
Expected monthly carry: $20 × 5 = $100/month
Planned hold: 30 days

Day-by-day:

Day 1: Entry at 0.6750, roll overnight earns +$8.33 (daily interest on 5 micro)
Day 5: Price rises to 0.6780, roll earns +$8.33 = +$41.65 cumulative interest
Day 10: Price falls to 0.6760, roll earns +$8.33 = +$83.30 cumulative interest
Day 20: RBA rate decision (no change), price stays at 0.6760, roll earns +$8.33 = +$166.60
Day 30: Exit at 0.6765

Final P&L:

Capital gain: (0.6765 - 0.6750) × 5000 units = $75
Rollover gain: $166.60 + final day
Total: ~$250

In your journal:

Metric	Value
Pair	AUD/USD
Entry	0.6750
Exit	0.6765
Capital P&L	+$75
Rollover P&L	+$167
Total P&L	+$242
Holding days	30
Reason for entry	RBA hawkish; expect AUD strength + carry
Reason for exit	Hit 30-day hold target

Now you can analyze: “My AUD carry trades averaged 25% annualized return (on this example). Most came from interest, not appreciation.”

Monthly Carry Trade Review

After 10 carry trades in a month:

Pair	Qty	Avg Hold	Capital P&L	Rollover P&L	Total	Best Feature
AUD/USD	3	20 days	+$150	+$200	+$350	Rollover
NZD/USD	2	15 days	-$50	+$80	+$30	Rollover
USD/JPY	3	10 days	+$100	-$50	+$50	Capital
GBP/USD	2	25 days	+$200	+$100	+$300	Capital

Insight: Your edge is in capital appreciation, not carry. You pick pairs that also appreciate, so you profit twice. This is better than pure carry (which would only profit from interest).

Common Carry Trade Mistakes (And How to Journal Them)

Mistake 1: Holding Through Rate Decision Announcements

You’re holding AUD/USD for 5 days of carry interest.

On Day 3, the RBA announces rates (no change).

But the market expected a cut. AUD crashes 100 pips overnight.

Your 5 days of carry ($50) is wiped out by the move ($500 loss).

In your journal: Log this separately. Note: “Held through RBA announcement—costly. Exit before major central bank decisions next time.”

Mistake 2: Not Accounting for Negative Carry

Some pairs pay negative carry—you lose money for holding overnight.

USD/JPY: USD 1.25%, JPY -0.1% = 1.35% positive carry (you earn)

EUR/JPY: EUR 0%, JPY -0.1% = 0.1% positive carry (minimal)

GBP/JPY: GBP 4%, JPY -0.1% = 4.1% positive carry (strong)

USD/TRY: USD 1.25%, TRY 20% = -18.75% negative carry (you pay!)

If you hold USD/TRY for carry, you’re fighting the interest rate differential. Your journal should flag this.

Mistake 3: Confusing Rollover Timing

Rollover happens at 5pm New York time (or your broker’s rollover time).

If you exit before rollover, you don’t get that day’s interest. If you enter after rollover, you don’t earn that day either.

Journal your entry and exit times relative to rollover. This affects how much interest you capture.

The Edge: Carry vs. Capital

After 50 carry trades, ask yourself:

Am I making money because:

I pick pairs with positive carry (anyone can do this)
I pick pairs that also appreciate (harder—this is skill)
I time the carry (buy before rate hikes, sell before rate cuts)

If (1): Easy to replicate and copy; not a durable edge.

If (2): You have genuine edge (pair selection + appreciation).

If (3): You have macro timing edge (rare).

Your journal tells you which one you’re actually doing.

Position Sizing for Carry Trades

Carry trades are lower volatility (you’re holding for interest, not price moves).

You can size slightly larger because risk is defined by your technical stop.

Example:

Technical stop: 100 pips
Risk per trade: 1% of account = $100
Position size: $100 ÷ 100 pips = $1/pip

On a normal technical trade (maybe 50-pip stop), you’d size to $100 ÷ 50 = $2/pip.

Carry trade gets smaller size because you’re widening your stop to allow for price oscillation while holding for interest.

The Carry Trade Advantage

Carry trades compound slowly but steadily. If you earn $50/month on average:

Year 1: +$600 (passive while you work on other trades)
Year 2: +$600 from prior carry trades + new carry trades
Year 5: +$3000/year accumulation

Combined with a directional trading edge, carry is reliable secondary income.

Your journal makes this visible and trackable.

Journal your carry trades

Common Journaling Mistakes

Forgetting to track rollover interest separately from market movement (you miss where profit actually comes from)

Treating carry trades like technical trades (carry is about time and rates, not charts)

Not accounting for broker spreads in carry calculations (a 2-pip spread on AUD/USD costs money even if you're right on carry)

Holding through central bank announcements (rate decisions destroy carry positions overnight)

Ignoring negative carry pairs (some pairs you pay to hold overnight; verify before entering)

Frequently Asked Questions

What's the difference between carry P&L and technical P&L?

Technical P&L is your entry/exit price difference. Carry P&L is the interest you earn (or pay) by holding. Both contribute to total P&L. If you lump them together, you can't see if your edge is in picking pairs or in interest timing.

Should I hold carry trades through central bank announcements?

Usually no. Rate decisions cause spikes that can blow through your stop. Consider exiting before major rate decision announcements.

Which pairs have positive carry (pay you to hold)?

Pairs where the base currency has higher interest rate than quote currency. AUD/USD, NZD/USD, and USD/JPY are common carry pairs. Check your broker for current carry rates.

How much does rollover interest matter for carry trades?

If you hold 10 trades per month for average 2 weeks, and earn $20/trade rollover, that's $200/month = $2400/year. It's significant enough to track separately.

Can I journal a carry trade that I exit in one day?

Yes, but it's not a true carry trade. You earned only intraday appreciation, no rollover interest. Log it, but note the short hold period.

What if interest rates change while I'm holding?

Interest rate expectations affect currency values. If you expect rate cuts in your base currency, the pair weakens. This market movement can outweigh carry gains. Track separately.

Should I use technical stops on carry trades?

Yes. Carry trades still need risk management. If technicals break, exit regardless of carry potential. Carry doesn't protect you from big moves.

How do I calculate rollover on micro lots vs. standard lots?

Rollover is per unit. Standard lot (100K units) earns 10x what a micro lot (1K units) earns. Your broker shows rollover rates. Multiply by position size.

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