Carry trading is one of the most simple strategies for currency trading that exists. A carry trade is when you buy a high interest currency against a low interest currency. For each day that you hold that trade, your broker will pay you the interest difference between the two currencies, as long as you are trading in the interest positive direction.

For example, if the Pound (GBP) has a 5 percent interest rate and the US Dollar (USD) has a 2 percent interest rate, and you buy or go long on the GBP/USD, you are making a carry trade. For every day that you have that trade on the market, the broker is going to pay you the difference between the interest rates of those two currencies, which would be 3 percent. This can really add up over time.