CFD Finance Calculation
Long positions: Number of CFDs x Stock or Index value x (Relevant Inter-Bank Offer Rate +3% or +2%) x Number of days held/365)
Short positions: Number of CFDs x Stock or Index value x (Relevant Inter-Bank Bid Rate -3% or -2%) x Number of days held/365)
- A floor will apply to the relevant Inter-Bank Bid/Offer Rate, i.e. if the Inter-Bank Rate is negative, then it will be excluded from the financing calculation.
- If the calculated financing rate on a short position (Inter-Bank Bid Rate – mark-down) is negative, then the financing credit will become a financing charge
CFD Finance Calculation details:
Here is an example of calculating Single Stock CFD finance charge on a long position for 3 days.
Barclays Plc CFD position value (Picture 1): GBP 3,099.20 ((2,000 x 154.96) / 100). Please note, that the CFD /stock price is in GBp, that is why we divide it by 100.
Number of interest days : 3 days
The applied rate (including a markup / markdown): 3.73%
Quotation (in day convention): 365
Therefore the interest can be calculated as follows (Picture 2):
3,099.20 x 3.73% x 3
____________________ = - 0.95
To view historical CFD financing costs, go to Historic Reports > CFD Finance Details (see an example below).