How large a factor is interest?

T

The Kin2

I have a long CAD/JPY play that I've been playing for a little over 3 months. It's usually a small position that I hold for less than a week, but it has been very profitable nevertheless. I have not been paying too much attention to the interest being paid, but I was doing a little quick math its a little more than I thought.

I'll admit that when I trade ForEx, I paid little attention to risk/reward and just went more for intuition. Most of my trades are good... I just get burned royally when I try shorting strong currencies (i.e. CAD, GBP).
 
Hi there,

Perhaps you can clarify who the question is directed at. Is it directed at you, the person in the trade, or the market in general?

Best regards,
MK
 
Interest is a HUGE factor with me.

Right now I am making about $600 a day in interest and LOVING IT.

Capital gains are better (tax wise), but as a swing trader interest is a good percentage of my gains.

Rule of thumb, do not go against the interest deferential, that can be a killer.

For example, I would NEVER go Short on GBP/JPY or long EUR/TRY.

However I short CHP/JPY whenever I believe the YEN is having a come back.

Also, I NEVER go long on gold, but right now I am shorting it. Why? Interest due!!!
 
Quote from MidKnight:

Hi there,

Perhaps you can clarify who the question is directed at. Is it directed at you, the person in the trade, or the market in general?

Best regards,
MK
More...

Hey,

It was more an open-ended piece, so everyone could add their own response. It's directed at anyone who wants to add their own 2 cents. :)
 
Quote from ZoneTrooper:

Interest is a HUGE factor with me.

Right now I am making about $600 a day in interest and LOVING IT.

Capital gains are better (tax wise), but as a swing trader interest is a good percentage of my gains.

Rule of thumb, do not go against the interest deferential, that can be a killer.

For example, I would NEVER go Short on GBP/JPY or long EUR/TRY.

However I short CHP/JPY whenever I believe the YEN is having a come back.

Also, I NEVER go long on gold, but right now I am shorting it. Why? Interest due!!!
More...


What kind of leverage are you using to get $600 a day?!? I almost want to say BS...
 
Here's the summary transaction for one of my accounts. I have two accounts that I am managing, with nearly equal amounts in them that pretty much are getting the same results.

Sorry, don't have time to write much more right now. Getting ready to head to the ocean.

Also, since you can see my account balance you can get an idea how much it takes to be earning this much interest in one account
 

Attachments

$600 in daily swap proceeds requires >2mm units in GBPJPY. 2mm units of GBPJPY carries a pip-value of $165. 4 pips = daily carry. Not for the faint of heart.
 
Quote from atticus:

$600 in daily swap proceeds requires >2mm units in GBPJPY. 2mm units of GBPJPY carries a pip-value of $165. 4 pips = daily carry. Not for the faint of heart.
More...


Try doing it with EUR/TRY. You'll need about half that.

Also, it takes awhile to get up to that position size. I buy on DIPS and only .05% of my NAV.

And remember: "One Rain Drop Raises the Sea"

Don't try to get to that position size all at once. YOU WILL BLOW YOUR ACCOUNT!!!!

Back to getting ready for the beach.....
 
Quote from ZoneTrooper:

Here's the summary transaction for one of my accounts. I have two accounts that I am managing, with nearly equal amounts in them that pretty much are getting the same results.

Sorry, don't have time to write much more right now. Getting ready to head to the ocean.

Also, since you can see my account balance you can get an idea how much it takes to be earning this much interest in one account
More...

Thank You.
 
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