Why is overnight funding charged and how is it calculated?

If you hold a short-term trade and want to keep it open overnight, you’ll be charged a daily interest fee.

This charge will be applied to cash CFD positions held through 10pm (UK time).

Futures and forwards don’t incur overnight funding charges, but they do have wider spreads. These contracts are typically used for longer-term trades.

Why is overnight funding charged?

When trading CFD, you’re using leverage. This means you are effectively being lent the money required to open your position, outside the initial deposit you’ve paid. To keep your position open after 10pm (UK time), an interest adjustment will be made to your account to reflect the cost of funding your position overnight.

How can I see what I've been charged?

Overnight funding charges appear as separate transactions on your account and won’t affect your running profit/loss. A statement which contains all trades and associated charges is automatically sent to your registered email address at the end of each day.

Indices

	For each day that a cash CFD position is open on a stock index, adjustments are calculated to reflect the effect of interest and dividends (if applicable). Cost currency is determined by the currency of the underlying asset for CFDs. ARR is calculated according to the currency of the underlying instrument. IG publishes weekly interest rates used to calculate the overnight funding rates (per annum) for Indices. You can find them here. Please note that open positions held through 10pm (UK time) on Fridays will be adjusted for three days’ worth of funding to cover the weekend. Please also note that we price our Volatility Index (VIX) and EU volatility Index contracts in a different way to the rest of our cash index markets. Please refer to the 'other markets' section further below.
	Formula: Number of contracts x value per contract x price x (3% admin fee +/- adjusted ARR) ÷ 365
	* Price = price at 10pm (UK time) + if long – if short 365-day divisor used for the FTSE 100 and other GBP, SGD and ZAR denominated markets. 360-day divisor used for all other markets.
	Example: You’re short two contracts on the US Tech 100 The contract value is $100 The 10pm (UK time) price is 6957 The 1-month SOFR rate* is 1.53% Cost = 2 x $100 x 6957 x (3% - 1.53%) ÷ 360 = $1,391,400 x 1.47% ÷ 360 = $56.82 overnight charge *We use SOFR and the 360-day divisor since you're trading the US index in USD

Shares & ETFs

	Cost currency is determined by the currency of the underlying asset for CFDs. ARR is calculated according to the currency of the underlying instrument. IG publishes weekly interest rates used to calculate the overnight funding rates (per annum) for Shares & ETFs. You can find them here. Borrow charge: When you are shorting a stock via cash CFD, you will incur a borrow charge. The borrow charge will be accounted for in a daily cash adjustment applied to your account. The charge varies according to the stock, is notified to us by our brokers or agents and includes a 0.5% administration fee. The borrow charge, and the ability to hold a short position, can be changed at short notice. To determine whether a borrow charge applies and if so, what the charge is, call our dealers in advance of trading. Please note that open positions held through 10pm (UK time) on Fridays will be adjusted for three days’ worth of funding to cover the weekend.
	Formula: Number of Shares x price x (3%* +/- ARR*) ÷ 360
	* Price = price at 10pm (UK time) + if long – if short 365-day divisor used for the FTSE 100 and other GBP, SGD and ZAR denominated markets. 360-day divisor used for all other markets.
	Example: You’re long 1500 contracts on Commonwealth Bank of Australia The contract value is AUD 1 The closing price is 83.90 The 1-month AUD ARR rate is 1.89% Cost = 1500 x 1 x 83.90 x (3% + 1.89%) ÷ 360 = AUD 125,850 x 4.89% ÷ 360 = AUD 17.09 overnight charge

Forex

For forex and spot metals deals, we charge the tom-next rate plus an admin fee of 0.8% (mini) / 0.5% (standard)

What is the tom-next rate? Find out more here.

Please note that forex positions held through Wednesday 10pm (UK time) will incur three days’ worth of tom next charge and one day of admin fee to cover the settlement of trades over the weekend. This is because FX settles on a T+2 basis. Therefore, when a position is held through Wednesday 10pm (UK time) it’s effectively being held through the weekend as positions can’t be settled until after Friday 10 pm (UK time). Subsequently, holding through Friday will only incur one day’s worth of tom next charge.

Please note that open positions held through Friday 10pm (UK time) will be adjusted for three days’ worth of admin charge and one day of tom next charge to cover the weekend.

	Formula: Long: Number of contracts x value of contract x offer swap rate Short: Number of contracts x value of contract x bid swap rate Example: You’re long one EUR/USD $10 contract The GBP/USD swap offer is -0.85 1 x $10 x -0.85 = $8.50 debit Note: the swap bid / swap offer rates displayed on the platform is an estimated all-inclusive rate (Tomnext charge + IG admin)
	What is the base calculation for FX funding?
	Formula: There are three steps to this formula: 1. Value Price in points x 0.8% (mini) / 0.5% (standard) ÷ 360 2. Swap rate When going short: Tom-next rate – value When going long: Tom-next rate + value 3. Cost Number of contracts x value of contract x swap rate
	Example: You’re short one EUR/USD standard lot The contract value is $10 The tom-next rate is 0.34 bid/0.39 offer The closing spot price is 1.0650 Value = 10650 x 0.5% ÷ 360 = 0.15 Swap rate = 0.34 – 0.15 = 0.19 Cost = 1 x $10 x 0.19 = $1.90 credit* *This is a credit since the bid interest rate is lower than the offer rate and you are holding a short position.

Commodities

Prices for commodity cash CFDs are synthetically created using the two most liquid futures contracts. This will result in a natural movement between these two contract prices and will be included in overnight funding adjustments. You’ll then either be debited or credited depending if you’re long or short, and whether the next future contract price is higher or lower.

To find out more on how we price our commodities, please click here.

Commodity funding is based on the market cost of carry, plus an admin fee of 3% per annum.

Please note that open positions held through 10pm (UK time) on Fridays will be adjusted for three days’ worth of funding to cover the weekend.

Formula:

There are three steps to this formula:

1. Basis (the daily movement along the futures curve)

(P3 – P2) ÷ (T2 – T1)

T1 = expiry date of the previous front future
T2 = expiry date of the front future
P2 = price of front future
P3 = price of next future

2. IG charge

Price x 3% ÷ 360

3. Adjustment

Bet size x (basis + IG charge)

Example:

You’re short one A$10 contract on Oil – US Crude
T2 – T1 = 31 days
P2 price is 4700
P3 price is 4770

Basis = (4770 – 4700) ÷ 31 = $2.258
IG charge = 4700 x 3% ÷ 365 = $0.386

Adjustment = $10 x ($2.258 - $0.386) = $18.72*

*$18.72 will be credited to your account as you were short, and the next future contract was higher than the front contract.

Cryptocurrencies

Overnight funding charges

Overnight funding on cryptocurrency CFD positions is calculated using an averaged market rate, adjusted by IG's administration charge. This means your funding costs will move with market conditions rather than being fixed.

Funding is applied to any position open at 10pm (London time), Monday to Sunday.

How your funding rate is calculated

Your daily funding charge or credit is calculated as:

A = V × R

Where: A = the funding adjustment (charge or credit) V = number of contracts × contract size × price R = the current averaged market rate, inclusive of IG's administration charge

Funding rates are quoted on a bid/ask basis. The ask rate applies to long positions; the bid rate applies to short positions. Depending on prevailing market conditions, either rate may result in a debit or a credit to your account.

Example overnight funding rates (% per annum)

Cryptocurrency	Short (Bid)	Long (ask)
Bitcoin	-4%	-16%
Ethereum	-4.5%	-15.5%
Solana / XRP	-8%	-17%
All other cryptocurrencies	-7%	-16.5%

A negative rate results in a debit to your account. A positive rate results in a credit to your account.

Rates are reviewed frequently and updated to reflect current market conditions. The latest rates are available on the web platform on the swap bid / swap ask section.

For more information on how to view this on the web platform, you may refer here.

Worked examples (illustrative — assuming Bitcoin at $80,000)

Long 1 Bitcoin contract: (1 × $80,000) × (16% ÷ 360) = $35.55 debit per day

Short 1 Bitcoin contract: (1 × $80,000) × (4% ÷ 360) = $8.88 debit per day

Other markets

Overnight funding for the following instruments is calculated in the same way as for commodities without fixed expiries: EU Volatility Index and Volatility Index. Prices on these markets for cash CFDs are synthetically created using the two most liquid futures contracts. This will result in a natural movement between these two contract prices and will be included in overnight funding adjustments. You’ll then either be debited or credited depending if you’re long or short, and whether the next future contract price is higher or lower. Funding is based on the market cost of carry, plus an admin fee of 3% per annum. Please note that open positions held through 10pm (UK time) on Fridays will be adjusted for three days’ worth of funding to cover the weekend.
Formula: There are three steps to this formula: 1. Basis (the daily movement along the futures curve) (P3 – P2) ÷ (T2 – T1) T1 = expiry date of the previous front future T2 = expiry date of the front future P2 = price of front future P3 = price of next future 2. IG charge Price x 3% ÷ 360/365 3. Adjustment (No. of contracts x value per contract) x (basis + IG charge)
365-day divisor used for the FTSE 100 and other GBP, SGD and ZAR denominated markets. This divisor will also be applied to all commodities denominated in CNH. 360-day divisor used for all other markets.
Example: You’re short 100 contracts on the Volatility Index The contract value is $100 T2 - T1 = 31 days P2 price is 15.50 P3 price is 16.50 Basis = (16.50 - 15.50) ÷ 31 = $0.03 IG charge = 15.50 x 3% ÷ 365 = $0.001 Adjustment = 1 x $100 x ($0.03 - $0.001) = $2.9* *$2.9 will be credited to your account as you were short, and the next future contract was higher than the front contract.