Currency Carry Trade Calculator
Calculate potential profits from currency carry trading strategies with rollover costs
About this calculator
The Currency Carry Trade Calculator helps forex traders evaluate potential profits from carry trading strategies by calculating returns from interest rate differentials between currency pairs. This tool factors in rollover costs, swap rates, and position sizes to provide accurate profit projections. It's essential for traders looking to capitalize on interest rate spreads while understanding the true cost of holding positions overnight, enabling better risk management and strategy optimization.
How to use
Enter your currency pair, position size, and holding period. Input the interest rates for both base and quote currencies, along with current exchange rates. The calculator will compute your potential carry trade profits, including daily rollover costs and total returns over your specified timeframe.
Frequently asked questions
What is a currency carry trade?
A carry trade involves borrowing low-interest rate currency to buy high-interest rate currency, profiting from the interest rate differential.
How are rollover costs calculated?
Rollover costs are based on interest rate differentials between currencies, position size, and current exchange rates, applied daily.
What risks should I consider?
Main risks include exchange rate fluctuations, interest rate changes, and market volatility that can offset carry trade profits.