In a note to clients Saxo Capital Markets one of the more professional CFD brokers has increased the charges for converting one currency to another.
One erk about having an account with Saxo is that the account generally automatically does currency conversions to your base currency. So if you make a profit in USD it is automatically converted into GBP.
This is quite handy in many respects as it means that your are not left running up interest fees if you have GBP on account, but have open positions (using USD margin) or realised USD losses on your account.
But, it’s a bit of a pain if you want to manage your currency exposure yourself. If you do you can always open up sub accounts with different base currencies and divide trading that way.
For more information on brokers that offer physical currency conversions for settlement see our currency broker section.
The note to clients read:
We will be increasing our charges for currency conversions on Thursday 18th May. This fee is applied when converting a trade into the base currency of a client’s account (if it differs from the currency of the trade).
For cash products (stocks, bonds, ETFs and the premium on options) currency conversions are charged on the purchase and sale at the mid FX Spot rate, plus/minus 1%.
For derivative products* currency conversions are charged on the profit and loss at the mid FX Spot rate, plus/minus 1%.
*For FX Options the rate is plus/minus 0.1%.