Rollover in forex is the overnight interest adjustment applied when you hold a position across two trading days, calculated based on the interest rate differential between the two currencies in the pair.
How Rollover Works
When you buy a currency pair, you’re simultaneously borrowing one currency and lending another. That interest spread is called rollover.
Example: Buying EURUSD at 1.0850
You’re:
- Borrowing USD (you shorted it to buy euros)
- Lending EUR (you bought it, so you own euros)
The rollover calculation:
- EUR interest rate (ECB): 4.0% per year
- USD interest rate (Federal Reserve): 5.5% per year
- Net interest rate differential: -1.5% per year (you pay because USD rates are higher)
Daily cost:
- -1.5% ÷ 365 days = -0.0041% per day
- On a 1 standard lot (100,000 units), that’s roughly -$4.10 per day
You pay roughly $4 per day to hold short EUR/USD. After one month (20 trading days), that’s $82 in costs.
When Rollover Is Charged
During the week:
- Rollover is charged at 5:00 PM ET (New York closing)
- Applied to all open positions at that moment
- Happens automatically; no action needed
On weekends:
- Friday night charges 3x the normal rollover (Friday + Saturday + Sunday)
- This is called “triple rollover” or “weekend charge”
Example: Hold EURUSD on Friday. At 5 PM ET Friday, you’re charged 3 days of rollover, not 1.
On public holidays:
- If a country’s market is closed, interest still accrues (you still own/owe the currency)
- Some brokers charge 2x rollover on days surrounding holidays
Positive Rollover (You Earn)
Some pairs have positive rollover. You get paid to hold them.
Example: Buying GBPUSD
- GBP interest rate (Bank of England): 5.25%
- USD interest rate (Federal Reserve): 5.5%
- Net differential: -0.25% (slightly negative)
But compare to EURGBP (buying EUR, shorting GBP):
- EUR interest rate: 4.0%
- GBP interest rate: 5.25%
- Net differential: -1.25% (negative)
And GBPJPY (buying GBP, shorting JPY):
- GBP interest rate: 5.25%
- JPY interest rate: -0.1% (Japan has negative rates)
- Net differential: +5.35% (positive!!)
You earn 5.35% per year just for holding the position overnight. On 1 standard lot, that’s roughly $535 per year, or ~$2.20 per day.
The Carry Trade
The carry trade exploits positive rollover:
Strategy:
- Find pairs with wide interest rate differentials
- Buy the high-yielding currency, short the low-yielding currency
- Hold the position long-term
- Collect rollover interest daily
- Profit from the interest differential, not price movement
Example carry trade: USDJPY
- USD rate: 5.5%
- JPY rate: -0.1%
- Differential: 5.6% per year
You buy USDJPY and hold it for a year. Even if the price doesn’t move, you earn 5.6% just from rollover.
Real example: In 2010-2015, traders earned massive rollover on USDJPY while the pair also rallied 30%. It was a carry trader’s dream.
Rollover and Leverage
Rollover costs compound when you use leverage.
Scenario:
- You have a $10,000 account
- You buy 10 standard lots of EURUSD with 10:1 leverage
- Rollover cost: -$41 per day (same as before)
That’s 0.41% of your account per day. Over 20 days, that’s 8.2% of your account eaten by rollover alone.
If you hold for 3 months:
- Rollover cost: $2,460
- That’s 24.6% of your account
This is why overleveraged carry traders blow up. Rollover compounds against them.
Rollover and Broker Spreads
Here’s the hidden cost: Most brokers mark up rollover.
Real interest rate differential: -0.4% per year
Broker’s rollover charge: -0.8% per year
Brokers make money on two fronts:
- Bid-ask spread on your trades
- Markup on rollover fees
On a small account, rollover markup is insignificant. On a $100k account holding for months, it adds up.
Rollover Times and Daylight Saving
Rollover time changes with daylight saving in the US:
| Time | When |
|---|---|
| 5:00 PM ET | November-March (Eastern Standard Time) |
| 4:00 PM ET | March-November (Eastern Daylight Time) |
If you’re in Europe and usually trade at 4 PM ET, remember it’s 5 PM ET in winter. Your rollover timing shifts.
Avoiding Rollover
Strategy 1: Close before 5 PM ET
- Exit your position before 5:00 PM ET
- Re-enter the next day after 5:00 PM
- Saves one day of rollover, but spreads widen at re-entry (might cost more than rollover)
Strategy 2: Use overnight interest as a filter
- Only buy pairs with positive rollover (you earn)
- Avoid pairs with negative rollover (you pay)
- This biases your portfolio toward carry trades, which can be risky in reversals
Strategy 3: Hold only intraday
- Never hold past 5 PM ET
- Avoids rollover entirely but limits your holding period
- Works for scalpers and day traders, not swing traders
Negative Rollover Pairs
These pairs charge you overnight interest:
| Pair | USD Rate | Other Rate | Differential | Direction |
|---|---|---|---|---|
| EURUSD | 5.5% | 4.0% (EUR) | -1.5% | Charge |
| GBPUSD | 5.5% | 5.25% (GBP) | -0.25% | Charge |
| NZDUSD | 5.5% | 5.5% (NZD) | 0% | Neutral |
| AUDUSD | 5.5% | 4.35% (AUD) | -1.15% | Charge |
Most USD pairs charge you because USD rates are high (as of 2026).
Positive Rollover Pairs
These pairs pay you overnight interest:
| Pair | Rate 1 | Rate 2 | Differential | Direction |
|---|---|---|---|---|
| USDJPY | 5.5% (USD) | -0.1% (JPY) | +5.6% | Earn |
| GBPJPY | 5.25% (GBP) | -0.1% (JPY) | +5.35% | Earn |
| AUDJPY | 4.35% (AUD) | -0.1% (JPY) | +4.45% | Earn |
| NZDJPY | 5.5% (NZD) | -0.1% (JPY) | +5.6% | Earn |
Any pair combining a high-rate currency (USD, GBP, AUD) with JPY earns positive rollover.
Rollover Impact on Different Strategies
| Strategy | Rollover Impact | Consideration |
|---|---|---|
| Day trading | Zero (close before 5 PM) | N/A |
| Swing trading | Moderate (3-10 days holding) | Adds up over time |
| Position trading | Major (holds weeks/months) | Can be 20-30% of return/loss |
| Carry trading | Entire strategy | Positive rollover is the trade |
Central Bank Rates and Rollover Changes
Rollover changes when central banks raise or cut rates.
Example: The Fed raises rates from 5.0% to 5.5%.
Before the hike:
- EURUSD rollover: -0.5% per year (EUR at 4.5%, USD at 5.0%)
- Daily cost: ~$1.37 per standard lot
After the hike:
- EURUSD rollover: -1.0% per year (EUR at 4.5%, USD at 5.5%)
- Daily cost: ~$2.73 per standard lot
Your daily rollover cost doubles. If you’re holding 5 lots, your overnight costs go from $6.85 to $13.70 per day.
How PipJournal Helps
PipJournal tracks your trade entries and exits precisely. Log the rollover cost (or credit) for each multi-day position. Over time, you’ll see: How much did rollover cost me this month? Am I holding pairs with positive rollover? Could I switch to higher-yielding pairs without changing my strategy? That data-driven approach to rollover management can add 10-15% annually to your returns.
