Carry trade investors should have heard that different currencies have different interest rates in foreign exchange transactions, and there will be overnight interest in foreign exchange transactions, sometimes positive interest rates and sometimes negative interest rates, resulting in positive overnight interest rates, which is one of the carry trades in foreign exchange transactions.
How can we always maintain a positive interest? This requires some trading skills. At this time, foreign exchange traders need to look for currency pairs with high interest rates and their commodities with low interest rates in order to obtain positive overnight interest. For example, in foreign exchange transactions, the interest rates of Swiss franc and Japanese yen are extremely low, while the interest rates of Canadian dollar and British pound are very high, so traders can use the spread between them to carry out foreign exchange arbitrage transactions.