Thread: What is SWAP?

Can anyone here explain me, what is SWAP? I just know Swap is a debit or credit paid..

An equity swap is a financial derivative contract (a swap) where a set of future cash flows are agreed to be exchanged between two counterparties at set dates in the future. The two cash flows are usually referred to as "legs" of the swap; one of these "legs" is usually pegged to a floating rate such as LIBOR. This leg is also commonly referred to as the "floating leg". The other leg of the swap is based on the performance of either a share of stock or a stock market index. This leg is commonly referred to as the "equity leg". Most equity swaps involve a floating leg vs. an equity leg, although some exist with two equity legs.

In finance, a swap is a derivative in which counter parties exchange certain benefits of one party's financial instrument for those of the other party's financial instrument.

In Forex terms that I know swap is basically the charges for overnight trades by broker, it’s usually two ways one is positive and negative. I am a Muslim, therefore I am not able to use swap account, so I have to thanks my broker OctaFX, it has allowed me to use the swap free account, so there is no trouble with my religion and I can be really comfortable in working. Also, it’s available for all in a really easy way.

swap fee is charged when we close the trade not in one day. more traders love trading account non-swap because we will not be cut off so that will make us able to trade with a maximum