All You Need to Know about OANDA Swap Free Account

Anthony:  Let me explain more about why Islam forbids swap. So, in Islamic finance, exchanging currencies with interest payments is not allowed because it goes against the concept of fairness and justice. Islam prohibits the earning of profit through exploitation or excessive interest rates, known as riba.

In a currency swap, two parties agree to exchange one currency for another at a specific rate and then reverse the exchange at a later time. In the conventional financial system, this often involves interest payments based on the difference in interest rates between the two currencies. However, in Islamic finance, interest-based transactions are not allowed.

Instead, transactions must be based on real economic activities, such as trade or investment, where profits are earned through productive activities. Therefore, currency swaps that involve interest payments are not allowed in Islamic finance.

Garfield: Actually, I don't know the broker policy about swap-free account but for sure, some broker need to see your ID because they only want to facilitate Muslim trader in order to trade freely without any rate. But if you said about broker`s profit decreased is totally wrong because swap-free account only mean you don't get any rate fee that acquire during switching day. all currencies actually have rate, and the rate may different each day so it become the basic of swap rate. So, it is not the broker's profit decreased but it is normally happen in Forex. It is yes swap-free account don't need to pay rollover fees/overstay fees but they need to pay more such as double spread or administration fee for example. About OANDA, like the article said, you just need to open standard account and then switch to swap-free without any requirement

Lalisa Indeed, I like swap-free accounts because that includes trading costs, right? At OANDA Swap or what is commonly called fees are calculated per position and can be either a fee or a credit to your account, depending on whether you are in a buy/long position or a short/sell position. and also Swap fees are charged if account positions are left open overnight later than 17.00 ET.
for me, fixed costs are costs be they swaps, spreads, and commissions. But it needs to be considered again, as a trader I also don't want to be limited. Now, the limited meaning here is that we cannot access all the instruments on OANDA and can only trade by choosing from 26 foreign exchange instruments and indices.
I prefer other accounts from OANDA because I can also choose a more varied instrument compared to this account.

Harrison: Swaps are usually experienced by traders when there are trading positions that are opened staying up past midnight. The amount is calculated from the applicable bank interest rate and can change depending on the trading position and the pair being traded. In other words, a swap is an interest a trader has to pay. Swap-free means free from this kind of charge.
in Islam, Swap is said to be usury because it is taken from the difference in interest rates, therefore it is not uncommon for Muslim people to prefer this account. but there are also those who don't like it, the reason is simple they are afraid of losing profits from the swap.
The OANDA swap-free and standard accounts have several things in common, namely, they both offer commission-free trading, the lot order size is the same, namely 0.01 lot, and we can use all trading strategies on OANDA.
In my opinion, if you really don't like interest because of usury, a swap-free account is more suitable for you. but if you don't have a problem with that, I suggest choosing a standard account because there are more instrument choices than swap-free accounts as well as a complete platform for trading, compared to swap-free accounts which can only trade with the MT4 platform.

Ramos: Basically, in Islamic finance, you can't charge swap fees that involve interest payments (also called riba). However, if the fees have been changed to spread and commission, it all depends on the terms and conditions of the transaction. The transaction should be based on real economic activity and should be free from any exploitation or injustice. If the spread and commission are reasonable and justified, then it's okay. But if they're excessive or not justified, it could be haram. And the spread and commission that happen during the trading is justified and reasonable since the broker paid for your swap fees.

And about the triple Wednesday Swap, the reason for that is due to the settlement cycle for forex trades. Basically, forex trades are settled two business days after the trade is executed. But since forex trading is open 24/7, traders can hold positions open beyond the spot settlement date.

When a trader holds a position open beyond the spot settlement date, they are borrowing one currency to buy another. The swap fee is charged to compensate the lender for the interest that they would have earned if they had held the currency themselves. The triple swap on Wednesdays is charged to account for the fact that the spot settlement date falls on a weekend, so the swap fee is charged for three days instead of two.

Ramos: Dude, you have said that trading term such as spread and commissions that happen in swap free account can be different between standard account ans swap free account. I have seen too the article and it said to be charge $7 and the spread is start at 1.6 pips at EUR/USD currency pairs. So, basically the commission is free and changed into administration fees meanwhile at the standard account, spread based on the OANDA website is at 1.2 pips. It means the trading condition is heavier at commission.

About the pips itself, how exactly I need to paid?? is it $1,6 at the spread that start from 1.6 pips?? Sorry for my bad English

Yugo: In forex trading, the value of a pip can differ depending on the size of your trading volume. Traders generally use three types of volume: Standard Lot, Mini Lot, and Micro Lot, which each have a different pip value.

For example,

• a Standard Lot represents 100,000 units of the base currency (such as 100,000 euros in the EUR/USD pair), and each pip is worth $10.
• A Mini Lot represents 10,000 units of the base currency, and each pip is worth $1 if your account is denominated in USD.
• A Micro Lot represents 1,000 units of the base currency, and each pip is worth $0.10 if your account is denominated in USD.

Therefore, if you trade with one lot, a spread of 1.6 pips on the EUR/USD pair would cost you $16. However, if you trade with 0.1 lot, the cost would decrease to $1.6, and if you trade with 0.01 lot, the cost would be $0.16. Essentially, the higher the trading volume, the higher the spread's value will be.

@Laned Marke:  Hey there! If you're interested in OANDA's Swap Free Account, there are a few things you should know. This type of account is designed for traders who follow certain religious practices that prohibit the payment or receipt of interest. In this case, traders can avoid swap fees that are charged on positions held overnight.

With a Swap Free Account, you won't be charged interest on any positions held overnight, which can be a real plus if you're trying to avoid fees. However, the account typically has a wider spread, which can impact overall trading costs and profitability. It's also worth noting that not all instruments are available for trading with a Swap Free Account, so you'll need to check if the ones you're interested in are available.

Depending on your trading style, a Swap Free Account may or may not be the best fit for you. Long-term investors, who tend to hold positions for weeks or months, may not be as affected by swap fees as high-frequency traders who hold positions for shorter periods. Additionally, traders who rely on technical analysis and use strategies that require holding positions overnight may find a Swap Free Account to be a good option.

@Aios Rab: Hey there! When comparing OANDA's Swap Free Account to similar offerings from other brokers, traders should consider factors such as pricing, available instruments, and additional features. Key differences between OANDA's swap free account and those offered by other major forex brokers may include the types of instruments available for trading, the level of fees or commissions charged, and the specific terms and conditions of the swap free account.

Traders should evaluate whether a swap free account is right for them by considering their trading style and needs. While a swap free account may offer benefits such as reduced trading costs, it may also come with drawbacks such as more limited trading conditions or higher spreads. Factors such as the trader's trading frequency, investment horizon, and risk tolerance should also be taken into account when deciding whether a swap free account is a good fit. Hope this answer can clarify your question!

@Taeyang: OK, friends, I want to help explain a little about the security of our account at OANDA. In my opinion, OANDA is one of the forex brokers that has been in this field for a long time because it started operating in 1997. wow, that's quite a long time in my opinion, because most forex brokers just started around the 2000s. Now for OANDA's own regulator, the good news is that it is regulated by 8 top-level international regulators, namely:

• OANDA Asia Pacific Pty. Ltd. regulated and licensed in Singapore by the Monetary Authority of Singapore and International Enterprise Singapore (Commodity Brokers) for commodity CFD trading
• OANDA Australia Pty Ltd. regulated in Australia by the Australian Securities and Investment Commission (ASIC)
• OANDA Japan Inc. holds a Type 1 Financial Instrument license from the Japan Financial Services Agency, is registered with the Local Financial Bureau Office, and is a member of the Japan Financial Futures Association.
• OANDA Corporation is a registered Retail Foreign Exchange Dealer (RFED) with the U.S. Commodity Futures Trading Commission. (Commodity Futures Trading Commission/CFTC), and a Forex Dealer Member (FDM) of the National Futures Association.
• OANDA (Canada) Corporation ULC is regulated in Canada by the Investment Industry Regulatory Organization of Canada (IIROC).
• OANDA Europe Limited is authorized and regulated by the Financial Conduct Authority in the UK.
• OANDA Europe Markets Limited is a company registered in Malta. The company is authorized and regulated by the Malta Financial Services Authority as a Category 3 Investment.
• OANDA Global Markets Ltd is regulated by the BVI Financial Services Commission.

@Taeyang: hello guys, I also want to help answer, is the OANDA broker safe for trading activities? My answer is that it's not too safe either. because apart from being regulated by more than 7 international regulators, there is something this broker lacks, namely negative balance protection. OANDA Global Markets Ltd does not offer negative balance protection, so traders may lose more than they invested.
but the positive side of this broker is that trader funds will be kept separately. So, if you want to consider this account as your trading broker, that's fine, but you can learn more to avoid doubts.

@Chaplhin: OANDA is generally considered a safe and reliable forex broker. It is regulated by several financial authorities, including the National Futures Association (NFA) in the United States, the Financial Conduct Authority (FCA) in the United Kingdom, and the Australian Securities and Investments Commission (ASIC).

Having multiple regulatory bodies oversee its operations provides an additional layer of protection for clients' funds and helps ensure the broker operates transparently and in compliance with industry standards.

However, like with any financial service, there is always some level of risk involved, and traders should always thoroughly research a broker before investing their funds. Additionally, it's important to implement risk management strategies and never invest more money than you can afford to lose.

@Tristan:  if I prefer the deposit and withdrawal method at OANDA, it's Skrill/Neteller. when compared to other withdrawal methods, Skrill/Neteller is the fastest method in my opinion for both funding and withdrawing funds.
Deposits with Skrill and Neteller are free and take up to 1 business day – However, Skrill/Neteller may charge a service fee. Withdrawals to Skrill and Neteller take up to 1 business day and are also free, although conversion fees may apply and Skrill/Neteller may charge additional service fees.

For other funding methods, the process of funds is quite long, around 1-3 days for the credit card method and 2-4 working days for the bank transfer method.

@Eleanor: So you missed this hot news from OANDA Broker? Well, American traders will have access to cryptocurrency trading instruments at the end of October 2022. The broker has announced the opening of a new cryptocurrency trading on the US market. It aims to provide investors with easy access to crypto alongside their existing forex portfolio in a secure environment.

As you explained, cryptocurrency trading is very popular among traders these days and OANDA has established itself as a trading provider with access to cryptocurrency trading for US customers.

From opening a Paxos account to fundraising and trading, everything is managed via the app, giving investors seamless access to leading cryptocurrencies such as Bitcoin, Ethereum and PAX Gold against the US Dollar via a single, intuitive platform.

While US traders don't have access to CFD products, OANDA broker has proven its credibility by adding access to US (United States) cryptocurrency products. It's a great step for this broker to be able to trade. Perhaps over time, OANDA will also have access to CFD instruments. no one knows about it.

@Apollo: Yes, I've heard the news too. I think at the moment OANDA is also a good broker for Cryptocurrency trading. the launch of this offer represents an opportunity for merchants to gain cryptocurrency exposure in a smart way with a trusted brand.

Cryptocurrencies were born out of a counterculture – the desire to trade currencies that were not regulated by any central bank and were not influenced by national currencies and major economic events. However, the interest of traders to trade cryptocurrencies is actually higher every year. That's why OANDA is ready to increase the demand for crypto trading by bringing cryptocurrencies accessible to all traders, including US traders.

Oh yes, don't forget that OANDA has years of experience and an unrivaled record in offering trading on forex and other derivative instruments around the world. OANDA's crypto partner, Paxos, is a leading provider of regulated blockchain infrastructure.

The functionality provided by the OANDA app goes beyond basic 'buy & sell', as traders can set limit and stop order parameters in their account and take profit and stop loss on positions.

@Caramel: I disagree with your reasons and statements about inactivity fees. The main reason why OANDA and some brokers charge an inactivity fee is because of the broker's server. The more accounts added to their servers, the more power is required. And the server must be qualified because it will also affect transactions. And the more accounts opened, the more expensive to maintain. In Forex Trading, many accounts will be inactive.

And I believe that every broker will have more inactive than active accounts because most traders, especially beginners, will quit Forex if they fail or lose all their money. Brokers cannot withdraw your funds without terms and conditions, especially segregated accounts. So they will be charged an inactivity fee and that was agreed upon because you agreed to the terms and conditions when you signed up.

@Yerren Green: When it comes to currency trading, EUR/USD is more popular than USD/JPY. Why? Well, it's because the Eurozone and the United States are big players in the global economy. So, people trade the Euro against the US Dollar a lot, which is what EUR/USD represents.

A few things contribute to the popularity of EUR/USD. First, both regions have strong economies and trade a ton with each other. Second, many different types of traders, like big institutions and regular folks like you and me, trade EUR/USD. More traders mean more action and excitement.

Now, let's talk about liquidity and volatility. Both EUR/USD and USD/JPY are considered liquid, which means they have a lot of buyers and sellers. As for volatility, it's all about how much the prices move. This can depend on things like news, economic events, and politics. Sometimes EUR/USD may be more volatile, and other times USD/JPY might take the lead. It can change based on what's happening in the world.

Oh, and about the spread. The spread is the difference between the buying and selling prices. The level you mentioned, 1.7 pips, is what you may see with some brokers for both EUR/USD and USD/JPY. But keep in mind that spreads can vary, so it's good to check with your specific broker.

Knowing which currency pair is popular and understanding their liquidity, volatility, and spread can help you make smarter trading choices. So, consider these things along with your own trading strategy and how much risk you're comfortable with. Happy trading!

Well, when it comes to your point, swap rates are indeed inevitable. These rates are tied to the reference interest rate of the country associated with the currency. Each currency has its own distinct interest rate.

Now, the swap rate is the fixed portion of a swap determined by the specific market and parties involved. In an interest rate swap, it's a fixed rate exchanged with a benchmark rate like LIBOR or the federal funds rate, with a plus or minus differential. It also denotes the exchange rate linked to the fixed portion of a currency swap. Swap rates are pertinent to various types of swaps.

In an interest rate swap, it's the swap of a floating rate for a fixed rate, while in a currency swap, it signifies the exchange of interest payments in one currency for payments in another. In both transactions, the fixed element is referred to as the swap rate.

Now, for the calculation, a straightforward method is employed:

• For Long Orders: Long-term interest rate minus short-term interest rate equals swap fee/swap profit.
• For Short Orders: Short-term interest rate minus long-term interest rate equals swap fee/swap profit.

For the latest rates, one can refer to the Oanda website for details.

Swap-free accounts are typically reserved for Muslim traders, aligning with Islamic financial principles that prohibit interest charges. The swap rate, incurred after holding a position past 5:00 PM EST, reflects the interest rate differential between traded currencies.

While non-Muslim traders can't access swap-free accounts, they can still leverage swap rates for profit. Positive rates occur when buying a higher-interest currency, while negative rates result from selling such a currency. Calculated based on various factors, swap rates vary across currency pairs, brokers, and market conditions, influencing overnight trading costs. Traders should consider these costs in their strategies.

Hey, for the first point, OANDA's swap-free trading account is indeed a haven for those steering clear of overnight swaps and interest. To get on board, just follow the article above.

Now, regarding professional traders, especially those rocking the long-haul strategies like swing and positional trading, it's a bit of a mixed bag. Some pros appreciate the simplicity and ease of the swap-free setup, while others might not find it as crucial to their strategy. It really depends on the trader's preferences and approach.

As for the swap fees rumor, it holds some truth. The value of swap fees can indeed fluctuate based on the currency pairs you're dealing with. It's a factor to consider, and being aware of these variations can be part of navigating the trading landscape smoothly. Additional information, you can read this information to learn more about swap fees's value! Click here! Hope that clarifies things!