Interest on your main account is calculated on the Net Free Equity. Interest on sub-accounts is calculated on the Account Value.

Net Free Equity definition

Your Net Free Equity is:

• The value dated cash balance of your main trading account, plus or minus cash balances on your sub-accounts in the same currency
• Plus or minus any unrealised profits or losses from open CFDs, FX Forwards and Futures on your main trading account and sub-accounts in the same currency 
• Plus the market value of any FX Options on your main trading account and sub-accounts in the same currency
• Minus any margin required for financing open positions on your main trading account and sub-accounts regardless of sub-account currency

Net Free Equity margin financing

The margin financing requirement may differ from the trading margin requirement. See the full list of cash collateral for margin financing used for Net Free Equity calculation under our General Business terms.

As the Net Free Equity is calculated based on open trade positions across all your accounts, please ensure you have sufficient cash available on your main account currency. If you do not, you risk being subject to a debit interest in your main account currency.

Account Value definition

Account Value of your sub-account is:

• The value dated cash balance of accounts in the same currency
• Plus or minus the value of any unrealised profits or losses from open CFDs, FX Forwards and Futures on accounts in the same currency
• Plus the market value of any FX Options on accounts in the same currency

Interest on accounts

The following interest rates apply to funds deposited with Saxo Bank 

• For positive Net Free Equity/Account Value, the interest rate will be the highest of either: the Saxo Bid interest rates minus the markdown or zero. Interest will be paid on the full amount if the Net Free Equity/Account Value is above the threshold.
• For negative Net Free Equity/Account Value, the interest rate will be the Saxo Offer interest rate plus a markup, but never less than the markup. Interest will be charged on the full amount for all Account Values/Net Free Equity.

For deposits in currencies with negative interest rates:

Saxo Bank charges negative interest based on relevant central bank rates. This charge applies to balances above the thresholds stated in the table below. The interest rates applied by central banks are continuously monitored by Saxo Bank. If a rate is changed, Saxo will adjust its negative interest rates accordingly with effect from the start of the next month.

The thresholds, markdown and markup are*:

On your main trading account, this threshold will apply to the available Net Free Equity. For sub-accounts it will apply to the account value. Thresholds apply across accounts in the same currency. Negative interest will be calculated daily for the credit balances exceeding the threshold. This will be debited to the main trading account or sub-accounts at the end of each month, for the interest period of the previous month (value date is the last day of the previous month).

*Markdown and markup varies based on the country of client residence.

Interest Calculation and Settlement

Interest will be calculated daily and settled monthly – within seven business days of the end of each calendar month. Interest is calculated according to the day count conventions and market standard set out in the table under Benchmarks Rates.

In supporting your financial aspirations and trading objectives, we provide both funding and liquidity for your trading activities in margin products. Our financing rates apply when you hold an open position in a margin product overnight e.g., a Contract for Difference (CFD) on a single stock.

Your financing rates consist of two components: 1) Saxo Bid/Offer financing rates and 2) commercial product markup/down.

The financing rates are set as:

• Bid = Saxo Bid financing rate – commercial product markdown
• Offer = Saxo Offer financing rate + commercial product markup 

Saxo Bid/Offer financing rates 

Saxo Bid/Offer financing rates refers to our pricing on financing i.e., we are charging floating interest rates. We use Alternative Reference Rates (ARRs) as an input when setting Saxo Bid/Offer financing rates. For currencies without a designated ARR, a money market rate, monetary policy rate or other relevant financial benchmark will apply as an input. 
Saxo Bid/Offer Financing Rates have a floor of zero percent, i.e. the interest rates can not be negative rates.

When you buy CFDs on single stocks e.g., in Hong Kong Dollars, we will convert our funding base into Hong Kong Dollars to finance the underlying purchase of the stocks. Conversely, if you are selling CFDs on a single stock e.g., in South African Rand, we will convert the proceeds from sale of the underlying stocks into our funding base currencies. These operations require active trading in various financial products in the interbank market to manage the liquidity cash flows generated by your trading activities. 

ARRs have been developed by working groups consisting of national and international industry associations, market participants, as well as central and reserve banks. They are publicly available and are recognised by National Competent Authorities (NCAs), market participants, and national and international financial industry associations. For more information on the relevant financial benchmarks listed below, please consult the financial benchmark administrator, central or reserve bank. 

The Saxo Bid/Offer financing rates are proprietary to Saxo Bank and subject to the provisions in our Document Center. One provision could be pass-through of cost related to external factors, such as changes in domestic and/or foreign monetary or credit policies that affect the general interest level or changes in cost structures with liquidity providers and brokers. 

As a reference, see applicable Benchmark Rates in the section below. 

Commercial product markups/downs 

For more information on our general pricing, please consult the page Pricing Overview 

Interest calculation and settlement 

Interest will be calculated daily and settled monthly – within seven business days of the end of each calendar month.

The benchmarks used when setting interest rates on deposits and financing rates on margin products are listed in the table below. Saxo Bank reserves the right to apply a business lag to the publication of financial benchmarks when calculating and booking unrealised and realised interest.

* For positive Net Free Equity or Account Value in Swiss Franc the applicable benchmark is Swiss National Bank (SNB) policy rate.

** For positive Net Free Equity or Account Value in Euros the applicable benchmark is European Central Bank (ECB) deposit facility rate.

When you trade an instrument in a currency that differs from your base denomination, conversions – including trading profits/losses – are executed using the FX spot mid-price, based on the time you close your position, plus/minus 0.5 percent.

The Currency Conversion fee does not apply to margin collateral. Only settlement of actual payments to or from the trading account are included, for example, buying/selling cash Stocks, paying/receiving options premium etc.

The rate used for currency conversion of amounts booked to your account is shown in the trading platforms under the “Trades Executed” report.

Custody fees for stocks, ETFs/ETCs and bonds

For accounts with stock, ETFs/ETCs or bond positions a custody fee of no more than plus/minus 0.12 % p.a.,  The minimum custody fee will always be applied to a default account. The custody fee will be calculated daily using the end-of-day values and charged on a monthly basis. Regional differences may apply.

Minimum fee

* Note that custody fees vary based on country of residence. To check the custody fee for your account, please log in to the platform, open Trading Conditions of a stock, ETF or bond and view the custody fee under the Trading rates tab.

Value Added Tax (VAT)

Custody fee is a VAT liable service, so VAT will be applied on top of the custody fee:

Physical persons

• residing within the EU, Danish VAT 25 % will apply
• residing outside of the EU, no VAT will be applied by Saxo Bank A/S

Corporate/Institutional client

• having its place of business in Denmark, Danish VAT 25 % will apply
• having its place of business within the EU (except for Denmark), no VAT will be applied by Saxo Bank A/S if a valid EU VAT ID is provided.* A reverse charge invoice will be provided.
• having its place of business within the EU (except for Denmark), Danish VAT 25 % will be applied if a valid EU VAT ID is not provided.
• having its place of business outside the EU, no VAT will be applied by Saxo Bank A/S, but local VAT rules may apply

*Only a EU VAT ID that is verifiable through the EU commission’s website:  http://ec.europa.eu/taxation_customs/vies/vatRequest.html?local=en will be registered as a valid EU VAT ID. If the EU VAT ID is not verifiable, please contact your local VAT authority.