In the mark forex market, all trades must be developed in two business days. A rollover refers to the procedure of closing open location for today's value date and the opening of the same place for the next day's value date at a price sparkly the difference in interest charge between the two currencies.
Rollover involves exchanging the location being held for a position expiring the following resolution date. For example, for trades executed on Monday, the value date is Wednesday.
However, if a location is opened on Monday and detained overnight, the price date is now Thursday. The exemption is a position opened and detained overnight on Wednesday. The normal value date would be Saturday; because banks are stopped on Saturday the value date is really the following Monday. Due to the weekend, positions held overnight on Wednesday invite or earn an additional two days of interest.
Overnight Interest/Rollover is routinely salaried to a client's account after buying a currency with superior Interest Rate in its country, and charged to a client's account if the country issuing this currency has smaller main Interest Rates.
by Martin Maier
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