Examples of Finance Rate in a sentence
For example, if the applicable Finance Rate (which may be displayed as swap) is negative 5.61% p.a., then the Finance Charge Adjustment for a particular day would be $0.44.
A Finance Charge will be debited for Equity or ETF Derivative position held overnight to your Account when the Finance Rate is negative.By way of example, using the calculation for a long Equity Derivative held overnight for a USD share whose Finance Rate is -5.61%.
The Finance Charge Adjustment/Finance Credit Adjustment is detailed on the statement and displayed under the “Swap/RO” column.A Finance Credit Adjustment will be credited for the Equity or ETF Derivative position held overnight to your Account when the Finance Rate is positive.
Finance Charge Adjustment Since you have taken a short position, in this example your Finance Rate is positive 2.89%, then the Finance Charge Adjustment for a particular day would be of $0.29 is calculated and reflected as a credit on your Trading Account on a daily basis under the heading “R/O Swap” which is taking into account in your Equity amount.Dividend adjustmentAt the end of August your position is still open at the time of the ABC Limited ex-dividend date.
Your profit on the Transaction is calculated as follows:Closing level: $3.20 Opening level: $2.86 Difference: $0.34Gross profit on Transaction: $0.34 x 1000 = $340 Finance Charge Adjustment Interest costs (imposed by way of the Finance Charge Adjustment) are calculated daily on positions held overnight by applying the applicable interest rate (Finance Rate) to the Contract Value of the Equity Derivative Positions, at the time the Equity Derivative is established.