On Interactive Brokers, I seem to be incurring daily interest charges. I have some balances in the various currencies, but the interest charges keep coming. I trade futures denominated in CHF, USD and EUR. How can I calculate how much I need? I have attached a recent daily statement. Base currency is GBP.
Could it be something as simple as you shorting a higher-yielding currency position overnight and therefore having to pay the carry?
I'm not sure; how can I tell that from the statement? As I'm trading futures, I hadn't expected to need to hold much in any foreign currency.
It is your choice. 1. Have enough currency to cover futures maintenance margin. 2. Borrow money from IB to cover the margin and pay interest rates.
My understanding is futures are settled daily. CME futures are USD based. If you are down that day, then money flows out of your account based on that day's P&L on settlement. If you are up that day, money flows in based on that day's P&L. On a currency account (say USD) where you don't hold any cash and have zero balance. If the overall P&L is negative on futures position, you get charged interest. If the P&L is positive, you don't. Day 1 P&L +1000. No interest, as 1000 flows in that day. Day 2 P&L +500. No interest, but 500 flows out that day. Day 3 P&L -300. Interest charged, as -800 flows out that day. Day 4 P&L -1000. Interest charged, as -700 flows out that day. Day 5 P&L +10000. No interest, as 11000 flows in that day.