The setup: one lot of USDJPY in numbers
- USD interest = 5.0%, JPY interest = 1.0% — an interest differential of 4.0% per annum.
- Broker markup = 0.65% — the haircut every retail broker books on top of the raw differential.
- USDJPY = 156. 1 standard lot = 100,000 USD, and for carry calculations the position value is simply 100,000 USD.
- Holding period = 5 days; swap is booked every night held. All four numbers drive the calculator below.
Long USDJPY: the carry trade itself
- Long USDJPY means you are long USD (earn 5%) and short JPY (pay 1%).
- Raw carry: 5.0% − 1.0% = +4.0% per annum.
- After the broker markup: 4.0% − 0.65% = +3.35% per annum.
- The carry credit over 5 days: 100,000 × 3.35% × 5/365 = +$45.89 — money received for simply holding the position.
Short USDJPY: paying for the privilege
- Short USDJPY means you are long JPY (earn 1%) and short USD (pay 5%).
- Raw carry: 1.0% − 5.0% = −4.0% per annum.
- After the broker markup: −4.0% − 0.65% = −4.65% per annum — the markup makes a bad carry worse.
- The carry cost over 5 days: 100,000 × 4.65% × 5/365 = −$63.70. Note the asymmetry: the long side receives +$45.89 while the short side pays −$63.70 on the same differential, because the markup always works against you.
Interactive yen carry calculator
Change the rates or the holding period and watch the carry move. Defaults are the worked example above: USD 5.0% vs JPY 1.0%, a 0.65% broker markup and 5 nights held on 1 standard lot (100,000 USD).
Position value
$100,000
1 lot(s) × 100,000 USD
Long carry
3.35% p.a.
USD − JPY − markup
Short carry
-4.65% p.a.
JPY − USD − markup
| Position | USD rate | JPY rate | Net carry rate | 5-day carry |
|---|---|---|---|---|
| Long 1 lot USDJPY | 5.0% | 1.0% | 3.35% | +$45.89 |
| Short 1 lot USDJPY | 5.0% | 1.0% | -4.65% | -$63.70 |
| Difference long vs short | +$109.59 | |||
Daily carry
Monthly carry (30 days)
Simplified retail-broker environment: carry is computed on the USD position value × net rate × days/365. It does not match the real institutional trade 100%, but it shows the workings nicely. Real swap booking runs through JPY conversion and your broker's own markup — check the live swap rates in your platform before trading.
Practice Carry-FreeWhy USDJPY was the classic carry trade
- The 5-day difference between long and short is $45.89 + $63.70 = $109.59 on a single lot, before any price movement.
- Per day: +$9.18 for the long vs −$12.74 for the short. Over a 30-day month that scales to roughly +$275 vs −$382 — a difference of about $657 per standard lot.
- EURUSD carried a 2% differential in our swap example; USDJPY doubles that. That is why USDJPY, not EURUSD, was the classic carry pair whenever US yields sat far above Japanese ones.
- With a 4% interest differential and only a 0.65% broker haircut, the long side receives meaningful positive carry while the short side pays heavily. That is the entire attraction of the trade: get paid every night just for being on the right side.
The catch: what happens when the trade unwinds
- Positive carry is not free money — it is a bet that the funding currency stays cheap. The risk is the exchange rate, not the interest.
- When yen yields rose, lending cheaply in JPY and investing in higher-yielding assets did not just stop — it had to be reversed quickly.
- Everyone who had borrowed yen needed to buy yen back at the same time, which drove up yen prices violently. The carry trade crowded everyone into the same exit: the profitable-every-night trade can become the fastest-moving loss in the book.
- This is the structural lesson of the carry trade: the nightly credit is small and steady, the unwind loss is sudden and violent. Size the position so that a sharp adverse move — not a quiet month — is the scenario you survive.
Carry costs in your broker comparison
- The 0.65% markup is the broker-controlled part of the carry bill — the raw differential is set by the two central banks, the haircut is not. Markups differ meaningfully between brokers, so compare the swap column, not just the spreads.
- On the short side the markup deepens an already negative carry (−4.65% instead of −4.0%); on the long side it clips your credit (+3.35% instead of +4.0%). Either way you pay it.
- For the full mechanics of how swaps are charged on a different pair, see the EURUSD swap cost breakdown — same arithmetic, smaller differential, and the direction flips which side pays.
- Then rehearse the multi-night holding discipline in the simulator: the carry math is what holding would cost on a live account, without the risk of holding one.
Practice this — risk-free
The WallStreet Billionaire simulator runs your trades against real historical charts with a virtual balance. Hold a USDJPY position for several candles in the simulator and feel the multi-night commitment — the carry math on this page is what that hold would earn or cost on a live account.
Can you win?Turn practice into prize money
Same charts, same 15 trades, shared starting balance — the winner takes 8× their buy-in in real money, 2nd gets 3×, 3rd gets 2×. Start with a free 5-trade demo run, or buy into a €5, €25 or €50 division.
Ready for the real market?
Practiced until your numbers are green? Open a live account with a regulated broker — and start small.
Frequently asked questions
What is the yen carry trade?+
Borrowing cheaply in low-yielding yen and investing in higher-yielding currencies or assets, pocketing the interest differential. In a retail broker account the simplest expression is being long USDJPY: you earn the USD rate (here 5.0%), pay the JPY rate (1.0%), and receive the differential — about 3.35% p.a. after the broker markup — as a nightly credit.
How much does 1 lot of long USDJPY earn in carry?+
In this simplified example: +$9.18 per night, +$45.89 over 5 days, roughly +$275 over a 30-day month — on a 100,000 USD position value with a 4% differential and a 0.65% broker haircut. The short side pays −$12.74 per night, about −$382 a month.
What happens when the carry trade unwinds?+
When yen yields rise, the trade stops working and has to be reversed quickly. Everyone who borrowed yen buys it back at the same time, driving up yen prices violently. The nightly credit was small and steady; the unwind loss is sudden — which is why the carry trade is famous for sharp dislocations, not quiet losses.
Why is the short side worse than −4.0%?+
Because the broker markup always works against you. Short USDJPY pays the raw −4.0% differential plus the 0.65% haircut: −4.65% p.a. The long side also pays the haircut (4.0% − 0.65% = +3.35%), which is why long and short carry are not symmetrical: +$45.89 vs −$63.70 over 5 days.
Is this exactly how brokers book USDJPY swap?+
No — this is an easy retail broker environment that does not match the real trade 100%, but it shows the workings nicely. Real swap booking runs through JPY conversion, uses the broker's own rate card and markup, and is displayed in points per lot. Check the live swap rates in your platform before acting on any number here.
Last updated: September 2026. Written and maintained by the WallStreet Billionaire research team, the same traders and engineers who build the simulator every guide on this site points to.
Data & methodology: pricing figures are illustrative estimates based on the published Saxo rate card as of August 2026 — spreads, commissions, CFD financing (8% p.a.) and FX swap (rate differential ± 0.65% markup). Broker pricing changes; verify current rates with the broker before acting on any number here.
Every guide pairs written strategy analysis with an interactive calculator so you can test the claim with your own numbers, then rehearse it risk-free in the simulator. Educational content only — not financial advice. See our imprint.