Glossary
What is Funding rate
A payment between longs and shorts on perpetual futures, usually every 8 hours. A positive rate means longs pay shorts; negative means the reverse.
How it works
BTC 1h, 03–05.03.2024: the dots are the long's funding payments every 8 hours.
Example
A long held for 2⅔ days in a rising market — 9 funding payments, 0.52% of the position in total. A $5,000 position ($100 risk with a 2% stop) would pay about $26 — 0.26R even if price had not moved.
Common mistake
Holding for days without counting funding: at a high rate it eats part of the R.
Read next
Related terms
Frequently asked questions
- Where can I learn Funding rate step by step?
- In the Trading OS Academy: “Costs: fees, funding, slippage”.
- What is Funding rate related to?
- Perpetual futures; Maker / taker fee; Leverage.
Plan versus outcome — for every trade
The Trading OS journal keeps the planned RR and the actual R of each trade side by side and computes expectancy from real results.
No sign-up — the journal runs in your browser; an account is only needed for sync.