Interest rates (overnight swaps) you wouldn´t believe
Minus interest, penalty interest, negative interest. These are the buzz words since the ECB, under its former president Draghi, demands penalty interest on deposits of surplus money from commercial banks. These in turn try to pass on the costs to their customers. The first banks have increased their fees and started to charge their customers’ balances with negative interest rates. The money account has finished and the inflation rate is no longer the only enemy.
On the 30.10.2019 there was World Savings Day and the time is ripe to take Moneymanagement into your own hands. For this, knowledge is necessary which is not taught in schools – but we should all deal with this – or – you carry your money to the bank and go to the pub with a beer.
There are instruments that, as a risk mixture and with a small portion of capital, can significantly increase the total return of a custody account without incurring incalculable risks. This all is a question of good diversification and risk spreading.
Trading CFD´s (Contract for difference / https://en.wikipedia.org/wiki/Contract_for_difference) Interest Rate Swaps are the result of different key interest rates of the central banks of the federal states. If you buy one currency (i.e. USD) then you always sell another one (i.e. EUR). The resulting overnight rate (interest rate swap) may be positive or negative, depending on the currency pair.
If you do not want to worry about it yourself, you can already let others act for you. Subscribing to a signal copies every trade into your account. Trading with CFD’s often needs less then 1,000 euro seed capital to get started.
How does it work?
- Open up an account online with a real ECN CFD-Broker
- Afterwards, subscribe to a signal from a signal provider
Philosophy: Gains are profits, losses are losses and open positions a passbook.