How funding works
A perpetual future has no expiry, so exchanges keep its price anchored to spot with periodic payments between longs and shorts. When the rate is positive, longs pay shorts; when negative, shorts pay longs. The payment is the rate times the position value, charged every interval, typically eight hours but four or one on some venues and markets. The funding rates guide covers what the rate says about crowding.
What the rate signals
The baseline on most venues is 0.01% per eight hours, which is about 11% a year and is what a balanced market pays. Rates well above that mean longs are crowded and paying to stay in; sustained negative rates mean the reverse. Those extremes have marked short-term tops and bottoms often enough to be a sentiment input, which is why open interest and funding are read together.
The cash-and-carry side
Because funding is paid to whoever is on the less crowded side, a spot long hedged with a perpetual short collects positive funding with no price exposure. That's the basis trade, and the calculator's per-day figure is what it earns before fees and the cost of capital. The futures basis guide covers the dated-futures version of the same idea.
Frequently Asked Questions
The guides behind this calculator
- Funding rates What the rate says about who's crowded.
- Futures basis The dated-futures version of the carry.
- Open interest How much leverage the funding is being paid on.
- Liquidations as a signal What happens when the crowded side gets flushed.
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Formulas last reviewed 2026-10-09. Educational tool, not financial advice. Results depend entirely on the numbers you enter.