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Costs

Overnight financing — definition & meaning

The cost of funding a leveraged CFD or margin position held overnight.

Overnight financing is the daily cost of borrowing to fund a leveraged position you keep open past the session close. On CFDs it is often the swap; on stocks bought on margin it is interest on the loan.

Because leverage means you are effectively trading with borrowed money, holding positions for a long time can quietly erode profits through these charges.

The information on Trding.io is for general information only and is not investment advice. Trading involves a real risk of losing money, and most retail traders lose. Never trade money you cannot afford to lose.

Related terms

Swap (rollover)
Interest paid or earned for holding a leveraged position overnight.
Leverage
Borrowed exposure that lets you control a large position with a small deposit.
CFD (contract for difference)
A leveraged contract to exchange the price change of an asset, without owning it.
Commission
A per-trade fee some brokers charge on top of, or instead of, the spread.
Spread
The gap between the bid and ask price — a built-in cost of trading.
Slippage
The difference between your expected fill price and the actual one.

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