FX Auto Swap Program

We have created a mechanism for certain clients carrying large forex positions providing superior carry costs when holding positions not closed out intraday. This program is not designed for and would not benefit any client who holds a single-currency long balance. The facility is associated with equal and offsetting positions in the forex market. The design allows clients to benefit from our participation in the interbank forex swaps market, where implied interest rate spreads are typically much narrower than spreads available in the retail deposit market.

As an alternative to our standard charges and payments for multiple large forex balances, we offer an Auto Swap program which allows you to take advantage of efficient interest rates paid in the Tom/Next market. Our Auto Swap program continually defers settlement of a spot forex position by entering offsetting forward positions on each day that the underlying spot position remains open. A long forex position becomes subject to continuous and offsetting short positions in the FX swaps market, where settlement occurs one day, and maturity occurs the next. So long as the forward FX swaps process is performed, the cost of carry associated with the underlying position can be handled more efficiently.

The service is freely available only for gross FX positions in excess of USD 10 million or currency equivalent. We offer the Automatic FX Swaps service on a commission-free basis and do not charge any markup on the program. We cannot guarantee a client's inclusion in the program and all inquiries require compliance approval prior to becoming active. Enrollment to this program is on a per account basis, any new accounts (including but no limit to sub account and link account) will not be enrolled automatically. To enroll in the program or for more information email fxswaps@interactivebrokers.com or click on the following Auto Swap link for more details.