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How to calculate overnight commissions for CFD on InteractiveBrokers?

Here https://www.interactivebrokers.com/es/?f=/en/trading/pdfhighlights/PDF-CFDs.php?ib_entity=es they state:

Overnight financing rates start at only 1.5%

But when I look at Commissions for North America there is no clue about how to calculate it. There is only one mysterious sentence I do not understand very well:

Orders that persist overnight will be considered a new order for the purposes of determining order minimums.

Does it mean that every night I have to pay the same commission as I paid when entering the order?

EDIT

My terminology is really bad. As order I meant fulfilled order so as @Victor says it is trade.

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  • An order is just that, it is not a trade. It means your order has not been executed yet and is still an active order.
    – Victor
    Jun 22, 2016 at 11:51
  • Can you add a country tag? CFDs are not legal in US, although I saw the site showed a US flag.
    – JTP - Apologise to Monica ♦
    Jun 22, 2016 at 12:33
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    @JoeTaxpayer - they are not legal in the US, but other countries where they are allowed can trade CFDs on US stocks.
    – Victor
    Jun 22, 2016 at 12:49
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    @Victor - got it, so the commission is based on the stock country, thus the flag. I misunderstood. As a result, no country required on question. Thanks again, Victor.
    – JTP - Apologise to Monica ♦
    Jun 22, 2016 at 13:01
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    @JoeTaxpayer - that's correct
    – Victor
    Jun 22, 2016 at 14:57

2 Answers 2

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IB's overnight financing cost for US CFDs below $100,000 is the Benchmark Rate + 1.5% for long positions and the Benchmark Rate -1.5% for short positions.

You can check the IB CFD Contract Interest for their full list of financing costs for share CFDs.

IB's commissions for an executed trade (where your monthly volume is below $300,000) is $0.005 per share with a minimum per order of $1.00.

Commissions and overnight financing are 2 different fees, the overnight financing is charged because CFDs are leveraged.

An order is just that, it is not a trade. It means your order has not been executed yet and is still an active order which you have not paid any commissions for yet.

Regarding the orders that persist overnight, an example might be, you place an order to buy to open 200 CFDs. If only 100 CFDs are traded on that day, and the remaining 100 CFDs of your order remains active overnight, it will be considered a new order for the purposes of determining commission minimums.

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  • Victor, thank you for the answer. I accepted it. But would mind to write me an example with real numbers pls. Let's say I have bought 10 CFD shares for GOOG and I want to keep it for 3 days. You can omit the commision. I'd like to understand the "Overnight" charges.
    – Amio.io
    Jun 22, 2016 at 13:31
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    You would multiply the GOOG share price by 10 then multiply this by the interest rate/ 365 x 3.
    – Victor
    Jun 22, 2016 at 15:10
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I have found a good explanation here: http://www.contracts-for-difference.com/Financing-charge.html

Financing is calculated by taking the overall position size, and multiplying it by (LIBOR + say 2%) and then dividing by 365 x the amount of days the position is open. For instance, the interest rate applicable for overnight long positions may be 6% or 0.06. To calculate how much it would cost you to hold a long position for X number of days you would need to make this 'pro rata' meaning that you would need to divide the 0.06 by 365 and multiply it by X days and then multiply this by the trade size. So for example, for a trade size of $20,000, held for 30 days, the interest cost would be about $98.6. It is important to note that due to financing, long positions held for extended periods can reduce returns.

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