Direct answer: what “rollover” means for CAD/JPY
Rollover (also called a swap) is the accounting value added to or subtracted from a forex position when you hold it past the broker’s daily rollover time. For CAD/JPY, the basic driver is the interest-rate differential between the Canadian dollar (CAD) and the Japanese yen (JPY), converted into a swap amount that depends on your position size and direction (long or short the pair).
Because rollover is typically quoted and applied by your provider, the exact number you see can also include provider adjustments, day-count conventions, and special handling on certain weekdays. That means you can understand the mechanics without assuming the displayed result is identical to a simple textbook interest differential.
Mechanism: the inputs and the calculation logic
1) Start with the position and direction
A forex position’s rollover is usually computed from the trade’s notional size (the face value exposure). The direction matters: being long one currency versus short the other determines whether you generally receive or pay the swap.
For CAD/JPY:
- A position that is “long CAD versus short JPY” tends to receive more rollover when CAD’s reference rates are higher.
- A position that is “short CAD versus long JPY” tends to pay more when CAD’s reference rates are higher.
2) Use reference interest rates for the two currencies
Conceptually, the rollover reflects the difference between the reference short-term interest rates of CAD and JPY. In simplified form, you can think of it as “how much interest the long side earns, minus how much interest the short side costs,” scaled to your notional and held time.
However, practical rollover calculations depend on more details than just the rate gap, such as:
- the provider’s reference pricing (how they translate market rates into swap inputs),
- day-count conventions (how interest is measured by the number of days), and
- the provider’s execution and quoting conventions.
3) Convert the interest differential into a daily amount
Rollover is generally applied on a daily basis using a formula that:
- takes the interest differential,
- scales it to your position size,
- adjusts for the holding period represented by that day’s rollover.
In many setups, the daily rollover amount is then expressed in the account currency (or converted internally) so it can be posted to your ledger.
4) Apply provider-specific adjustments
Providers do not only compute “pure” interest-rate differentials. They also incorporate provider-specific elements such as:
- how they set their own swap/rollover rates shown on their platform,
- costs embedded in their pricing,
- and operational conventions for when rollovers are applied.
So, the best self-check is usually: the provider’s stated swap rate for the specific currency pair, direction, and day is the direct input used for your posted rollover.
Evidence or example (with explicit assumptions): triple-swap and weekend handling
Assumption-based example structure
Because you might want to verify your own posted rollover, an evergreen way to check is to separate the concept into components:
- Daily swap logic: swap is a function of notional, direction, and the day’s rollover rate.
- Weekend adjustment: for some providers, the rollover applied before the weekend effectively covers more than one calendar day.
Triple-swap convention
A common convention is triple-swap: the rollover posted on certain days (often the day that precedes the weekend rollover) uses roughly three days’ worth of interest rather than one. The intent is to account for the fact that markets/settlement-related conventions pause over the weekend.
Material limitation: “triple” is a convention, not a promise of exactly three calendar days of interest across all providers, instruments, and setups. Exact behavior can differ because providers choose their own operational rollover schedules and day-count practices.
What you can verify independently
If your provider posts rollover separately for each day, you can verify the pattern without needing live rates by observing:
- whether the rollover on a particular weekday is noticeably larger in magnitude,
- whether the larger amount corresponds to an extra-day convention (for example, a “triple” posting), and
- whether the sign matches your position direction.
Limitations and failure modes: why two traders may see different rollover
- **Provider quote vs.