This free carry trade calculator ranks every major-pair combination by interest rate differential and prices the carry on your own position size. The ranking table below is built from the July 2026 central bank policy rates published on our interest rate tracker. Pick a base and quote currency, enter your lot size and leverage, and the tool returns the annual carry, the per-day carry, and the carry expressed as a percent of the margin you posted. That last number is the one that makes carry trading look irresistible, and it is also the one that hides the risk.
Carry Trade Calculator and Pair Ranking
One standard lot is 100,000 units of the base currency. Use 10,000 for mini lots or 1,000 for micro lots. Carry and margin are both reported in that same base currency.
Margin posted equals the notional divided by the leverage. Higher leverage means less margin and a bigger carry-to-margin ratio.
Honest line, always read it: your broker will not pay you the raw differential. The swap you actually receive is materially worse, because the broker keeps a markup on both legs of the tom-next roll. On many retail accounts the received leg is cut by roughly a third to a half, and the paid leg is inflated. Treat every number above as the theoretical ceiling, not a quote.
Live ranking: all 28 major-pair combinations by rate differential
Built from the eight major central bank policy rates as of July 2026. The ranking is directional, so every pair appears twice with opposite signs. Rates sourced from our interest rate tracker.
What a carry trade is, in plain terms
A carry trade buys a high-rate currency and funds it with a low-rate one. You hold the position and collect the gap between the two interest rates. In forex this happens automatically. Every position open past the daily rollover pays or receives a swap adjustment.
Look at AUD/CHF in July 2026. The Reserve Bank of Australia holds 4.35%. The Swiss National Bank holds 0.00%. Buy AUD/CHF and you are long a 4.35% currency against a 0.00% currency. The raw differential is 4.35% a year on the notional you control.
That is the whole mechanism. On its own it is dull. Leverage is what made carry famous, and leverage is what makes it dangerous. The rest of this guide is about that second half.
The July 2026 policy rates behind the ranking
The tool uses one shared rate set across this site. These are the eight major central bank policy rates as of July 2026, taken from our interest rate tracker. Update that page and the ranking logic here uses the same numbers.
| Currency | Central bank | Policy rate | Note |
|---|---|---|---|
| AUD | Reserve Bank of Australia | 4.350% | Highest of the eight majors |
| GBP | Bank of England | 3.750% | Bank Rate |
| USD | Federal Reserve | 3.625% | Midpoint of the 3.50-3.75 target range |
| NZD | Reserve Bank of New Zealand | 2.500% | Official Cash Rate |
| EUR | European Central Bank | 2.250% | Deposit facility rate |
| CAD | Bank of Canada | 2.250% | Overnight target |
| JPY | Bank of Japan | 1.000% | No longer the free funding leg |
| CHF | Swiss National Bank | 0.000% | Lowest of the eight majors |
Two things stand out. AUD against CHF is the widest gap at 4.35%. And JPY at 1.00% is no longer the cheap funding leg it was for two decades. That single change reshapes the whole ranking.
How to use this carry trade calculator
- Scan the ranking table first. It sorts all 28 major combinations by raw differential, biggest positive carry at the top, biggest negative carry at the bottom.
- Pick a base currency, the one you buy. Pick a quote currency, the one you sell. The calculator refuses to price a pair against itself.
- Enter your position size in lots. Leave the contract size at 100,000 units unless your broker uses a different standard lot.
- Set the leverage you actually use. This decides the margin posted, and margin drives the headline percentage.
- Read the four outputs: annual gross carry, per-day carry, margin posted, and annual carry as a percent of that margin.
- Then read the honest line under the results and apply the haircut. The broker swap is always worse than the raw differential.
Every number the tool prints is arithmetic on the rates you selected. None of it is a forecast of what a position will return.
A worked example: one lot of AUD/JPY
Load the defaults and follow the numbers. You buy one standard lot of AUD/JPY. That is 100,000 Australian dollars of notional. The RBA rate is 4.35%. Against that, the BoJ rate is 1.00%. Thus the raw differential is 3.35%.
Apply that to the notional. 100,000 AUD times 3.35% gives 3,350 AUD of annual gross carry. Divide by 365 and you get 9.18 AUD per day. Those are the theoretical ceiling figures, before your broker takes anything.
Note the currency on those two numbers. They sit in the base currency, and the reason is worth spelling out. You earn 4.35% on the 100,000 AUD you are long, and you pay 1.00% on the yen you borrowed to fund it. Restate the second leg in Australian dollars and the two legs net to 3.35% of 100,000 AUD. Multiply by the spot rate if you want the yen figure: 3,350 AUD is about 301,500 JPY at 90, 335,000 JPY at 100 and 368,500 JPY at 110. The tool never does that step for you, because it holds no live prices.
Adding leverage to the same one-lot position
Now bring leverage in. At 1:100, one lot of 100,000 AUD requires 1,000 AUD of margin. The annual carry of 3,350 AUD against margin of 1,000 AUD is 335%. Both sides of that ratio share one currency, so the percentage means something. That is also the number that sells carry trading in forums and course adverts.
It is also arithmetic, not a return. The 335% ratio does not change your exposure. You still control 100,000 units of AUD. A 3.35% adverse move in AUD/JPY erases a full year of theoretical carry in a single session. Yen pairs have moved that far in one afternoon many times.
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The math behind the carry number
The formula has four inputs and no hidden steps. Notional equals lots times contract size. The differential equals the base policy rate minus the quote policy rate. Annual gross carry equals notional times the differential divided by 100. Per-day carry equals the annual figure divided by 365.
Margin posted equals notional divided by leverage. Carry as a percent of margin equals annual carry divided by margin, times 100. That final ratio simplifies neatly: it is just the differential multiplied by the leverage. A 3.35% differential at 1:100 is always 335%, whatever the lot size.
That identity is worth pausing on. The percentage does not measure skill or edge. It measures how thin your margin buffer is. Doubling the leverage doubles the headline number and halves the price move needed to wipe you out.
Every money figure the tool prints sits in the base currency: notional, annual carry, per-day carry and margin alike. That is deliberate, and it keeps the carry-to-margin ratio dimensionally honest, because both sides of it share one unit. To restate the carry in the quote currency, multiply by the current spot rate yourself. The tool applies no exchange rate anywhere, because it holds no live prices. For the pip arithmetic on the same position, including the 0.01 pip size that yen pairs use, cross to the pip value calculator, and for margin restated in your account currency use the margin calculator.
Why leverage turns a 3% differential into a headline number
Unleveraged, a 3.35% differential is a modest yield. It sits close to what a short-dated government bond pays, with far more volatility attached. Nobody builds a strategy around that alone.
Leverage changes the presentation, not the substance.
- At 1:30, the EU retail cap, a 3.35% differential becomes 100.5% of margin.
- At 1:100 it becomes 335%.
- At 1:500 it becomes 1,675%.
Same trade. Same exposure. Identical currency risk. Only the denominator shrank.
Here is the trap in one line. Leverage multiplies the carry and the drawdown by the same factor, but only the carry gets advertised. At 1:100 your margin buffer is 1% of notional. A 1% adverse move in the pair puts you at zero margin, and brokers issue a margin call well before that.
So the honest framing is this. Carry is a slow, small, steady credit. Price risk is fast, large and lumpy. Leverage scales both, and the price risk arrives first.
The raw differential is not your broker's swap
This is the single biggest gap between the ranking table and your account statement. The table prices the difference between two central bank policy rates. Your broker prices the tom-next forward roll, then adds a markup on both directions.
Three costs sit between the two figures. First, the interbank funding rate is not the policy rate; it drifts with credit conditions and quarter-end pressure. Second, the broker applies an administration markup, commonly 0.25% to 1.0% annualised per side. Third, that markup is asymmetric: it cuts what you receive and inflates what you pay.
The practical result is blunt. A 3.35% raw differential can arrive as 1.5% to 2.5% in your account. A negative differential can arrive far worse than the raw number suggests. Some brokers even charge on both sides of certain pairs.
Never trade carry from a theoretical table. Open your platform, read the actual swap long and swap short values for the exact symbol, then price them with our swap calculator. Check the triple-swap day too, usually Wednesday, when three days of rollover post at once.
Carry pays only while the exchange rate cooperates
A carry position has two profit and loss streams. The swap accrues in small daily amounts. Exchange rates move in large, irregular jumps. The second stream dominates almost always.
Run the comparison on AUD/JPY, and run it carefully, because the pip size on a yen pair traps people. The raw carry is 9.18 AUD per day per lot. The pair's average daily range on a normal session runs well above 60 pips. A yen pair prices one pip at 0.01, not the 0.0001 the other majors use, so 60 pips on one standard lot is 60 x 0.01 x 100,000 = 60,000 JPY of movement in quote terms. Near a spot rate of 100 that same move is worth about 600 AUD.
Now compare like with like. About 600 AUD of daily price movement against 9.18 AUD of daily carry means price is roughly 65 times larger than the carry. Convert both to yen instead and you get the same answer: 60,000 JPY of movement against 918 JPY of carry at spot 100. Divide the 60,000 JPY range by the 9.18 AUD carry without converting and you get a meaningless 6,500, which is the mixed-unit error this site's pip value calculator exists to stop. The ratio is 65, and it is large enough already.
So carry is never the main variable. It is a small tailwind on a position whose outcome is decided by direction. A carry trade that ignores direction is a directional trade with extra steps and a coupon attached.
Correlated carry pairs act as one position
Correlation makes this worse in a portfolio. Carry pairs move together, because they share the same funding leg and the same risk appetite driver. Check our forex correlation matrix before stacking three carry positions. Three correlated carry trades are one large trade wearing a disguise.
How the yen carry trade ended in 2008
The 2000s version was textbook. Rates at the Bank of Japan sat near zero. The RBA and RBNZ held rates above 7%. Borrowing yen to hold Australian and New Zealand dollars paid a wide differential, and it paid quietly for years.
AUD/JPY traded near 108 in the summer of 2007. Position books were enormous, and much of the flow was leveraged. The carry looked stable because it had been stable for a long time.
Then the credit crisis arrived. Funding markets seized, risk appetite collapsed, and every leveraged holder needed yen back at once. That is the mechanic that matters: unwinding a carry trade means buying the funding currency, and everyone unwinds together.
By October 2008 AUD/JPY printed near 55. That is roughly half the value, and much of the damage landed in a handful of violent sessions. Years of accumulated differential were erased in weeks. Traders who were leveraged did not get to wait for the recovery, because margin calls closed them first.
The August 2024 yen carry unwind
The 2024 episode was faster and it is the more useful lesson. Japanese rates were still near zero, and USD/JPY traded near 162 in early July 2024. The yen carry trade had been quietly working for over two years.
Two things then hit together. The Bank of Japan raised its policy rate on 31 July 2024. Days later, weak US labour data pulled Fed cut expectations forward. The differential narrowed from both ends at once.
The unwind took three sessions. USD/JPY fell from the low 160s into the low 140s. On 5 August 2024 the Nikkei 225 lost more than 12% in one day, its worst session since 1987. Volatility gauges spiked to levels last seen in 2020.
The pattern repeats across both episodes. Long stretches of small, steady gains. Then a sudden, correlated, multi-day reversal that takes back years of accumulation. Carry return profiles are not symmetric. Model your position for the reversal, not for the calm period, and size it with the drawdown calculator.
Reference table: carry and margin per standard lot
These values are pre-computed from the July 2026 rates at one standard lot of 100,000 units. Every money column is in base-currency units, matching the calculator above, and every one excludes broker costs. So the AUD/JPY row reads 3,350 AUD a year, not 3,350 JPY.
| Pair | Differential | Annual carry | Per day | Margin at 1:100 | Carry vs margin |
|---|---|---|---|---|---|
| AUD/CHF | +4.350% | 4,350.00 | 11.92 | 1,000 | +435.0% |
| GBP/CHF | +3.750% | 3,750.00 | 10.27 | 1,000 | +375.0% |
| AUD/JPY | +3.350% | 3,350.00 | 9.18 | 1,000 | +335.0% |
| USD/JPY | +2.625% | 2,625.00 | 7.19 | 1,000 | +262.5% |
| NZD/CHF | +2.500% | 2,500.00 | 6.85 | 1,000 | +250.0% |
| AUD/CAD | +2.100% | 2,100.00 | 5.75 | 1,000 | +210.0% |
| USD/CAD | +1.375% | 1,375.00 | 3.77 | 1,000 | +137.5% |
| EUR/CAD | 0.000% | 0.00 | 0.00 | 1,000 | 0.0% |
| JPY/AUD | -3.350% | -3,350.00 | -9.18 | 1,000 | -335.0% |
| CHF/AUD | -4.350% | -4,350.00 | -11.92 | 1,000 | -435.0% |
Note the symmetry. Every positive carry pair has an exact negative mirror. EUR/CAD sits at zero because both banks hold 2.25%, so carry gives you nothing there in either direction.
What this carry trade calculator cannot tell you
Name the assumptions and you can see the gaps. Here is the honest list.
It cannot tell you your broker's swap. The tool models policy rates, not tom-next pricing plus markup. The real credit is materially smaller, and on some pairs both directions are charged.
It cannot convert currencies. Carry, notional and margin all appear in base-currency units, with no exchange rate applied anywhere. They compare cleanly to each other, but not to a euro or dollar account balance unless the base currency happens to match. Multiply by the current rate before you compare.
It cannot forecast the exchange rate. Direction decides your outcome, and this tool holds no price data at all. Nothing here is a projection.
It cannot see rate changes. Central banks move, and a differential can halve on one decision, as 2024 showed. Track upcoming meetings on the economic calendar and current pricing on live forex rates.
It cannot see your broker's holiday and value-date calendar. Triple-swap days, rollover time, and market holidays all shift the actual credit. It also ignores commission, spread and financing on the position itself.
Finally, it assumes 365 days. Some brokers accrue on a 360-day basis, which changes the per-day figure by about 1.4%.
Risk management framing for a carry position
Treat a carry trade exactly like any other directional trade. The differential is a small bonus, never the thesis. Size the position from your stop distance and your account risk, not from the yield.
Run the numbers before you open anything. Use the position size calculator to convert a stop distance into lots. Then use the risk of ruin calculator to see how a leveraged, correlated book behaves across a long sequence of trades. Carry positions are usually held for months, so a single adverse regime hits every one of them at once.
Three practical rules follow from the 2008 and 2024 episodes. Cap total exposure across all carry pairs, because they are one trade. Keep leverage low enough that a normal three-day reversal cannot force a margin call. And set a stop, because the unwind gives no warning and does not pause for your review.
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FAQ
Which pair has the widest carry?
On the July 2026 rates, AUD against CHF is widest at 4.35%. AUD is the highest major rate and CHF the lowest. The mirror, CHF against AUD, is the widest negative carry.
Why is the yen no longer the classic funding currency?
Because the Bank of Japan now holds 1.00%. For two decades it sat near zero, the cheapest funding leg available. At 1.00% the yen still funds AUD and GBP, but the edge is much narrower.
Will my broker pay the differential shown here?
No. The tool prices the raw gap between two policy rates. Your broker prices the tom-next roll and adds a markup on both legs. Expect a smaller credit and a larger debit. Read your platform's swap values first.
Is a 335% carry-to-margin figure a return on my money?
No, and this matters. That ratio is just the differential times your leverage. It measures how thin your margin buffer is, not what you earn. At 1:100, a 1% adverse move consumes your whole posted margin.
How long do carry trades work before they break?
There is no reliable answer, and that is the honest position. The 2000s yen carry ran for years before breaking in 2008. The 2022 to 2024 version unwound in three sessions. Treat every carry position as a directional trade with a stop. Results are not guaranteed; past performance is not indicative of future results.
External references
Carry trade on Wikipedia · Currency carry trade at Investopedia