It is an indisputable fact that in order to trade currencies one has to open a live account with a broker and deposit some money there. To be able to employ consistent position sizing techniques and earn sufficient profits even with low leverage, this deposit should be quite big. You may trust your broker’s credibility to deposit some $10,000 into your real account, but locking such an amount that would probably sit idly there for significant periods of time can appear wasteful to many traders. This is why such traders prefer to receive some interest rate payments on their Forex account balance.
Searching for brokers with interest rate payment reveals that about 39 out 199 FX companies offer this feature. Usually, the interest rate is not too high and, obviously, depends on the account currency. For USD, the annual rate is close to 2–4% and rarely goes above 5%. That does not look like a lot, but it can be a nice bonus to your trading profits, while for some exotic currencies, the annual rate on unused balance may be higher than 10%. Although it is the annual rate that is usually displayed by the broker, the interest payments are normally applied monthly.
Personally, I get monthly interest payments from one of the brokers and I am quite happy with them. I do not currently use that account for trading, but I prefer not to withdraw the balance for the sake of those payments and in case I would suddenly decide to start trading there again. Unfortunately, my main brokers, which I actively use for my foreign exchange operations, do not pay any interest on my accounts. And how about you?
If you have any questions or comments about getting interest rate on your trading account balance, please feel free to submit them below.