Key Considerations When Holding Positions
While holding positions beyond market hours offers strategic flexibility, it also introduces risks that every trader should understand.
1. Market Gaps and Volatility
When markets are closed — such as over the weekend or during overnight hours — significant economic, political, or global events may occur. These can cause the market to reopen at a different price than it closed, creating what’s known as a price gap.
Example:
You close Friday with a long EUR/USD position at 1.0950. Over the weekend, unexpected news causes the market to open at 1.0880 on Sunday night. This 70-pip gap against your position could result in larger losses than anticipated — especially if you were using tight margins or higher leverage.
Potential outcomes of a price gap:
Slippage on stop-loss orders
Sudden equity drawdown
Margin calls or liquidation if your margin isn't sufficient
2. Limited Trade Management During Closed Hours
You won’t be able to close, adjust, or manage your trade while markets are closed. If significant price movement occurs — particularly during weekend hours — your account could experience adverse effects before you're able to take action.
3. Swap Fees (Rollover Charges)
When you hold a position past the broker’s rollover time (typically 5 PM EST), you'll incur swap fees depending on:
The instrument you’re trading
Whether you are long or short
The interest rate differential of the currencies involved
Example:
Holding a short AUD/JPY trade past 5 PM EST may result in a positive or negative swap depending on the interest rate differential. Over a weekend, this charge can be tripled, since markets are closed for multiple days.
How to Manage Risk When Holding Trades Overnight or Over Weekends
While it can be profitable to hold positions longer-term, here are some ways to protect your capital:
1. Use Stop Losses
Always place stop-loss orders to define your maximum acceptable loss. Gaps can cause slippage, but a stop-loss is still your first line of defense.
2. Reduce Position Size Before Weekends
If you're unsure about weekend risks, consider partially closing your position or scaling down before Friday's close.
3. Monitor Economic Calendars
Check for major announcements like Non-Farm Payrolls, Central Bank Decisions, or geopolitical developments that could cause volatility.
4. Limit Your Leverage
Smaller position sizes with conservative leverage reduce the impact of unexpected movements. Over-leveraging increases the risk of a margin breach.
5. Understand Swap Costs
Factor in the cost of holding trades over the weekend — particularly on instruments with higher swap rates or leveraged positions.
Holding trades overnight or through the weekend is allowed at Atlas Funded — but it comes with risk. Be strategic, monitor your exposure, and always trade with a clear plan in place.
