Does funding count as a trading fee charged by the exchange?
My understanding is that when the futures price is higher than the spot price, the funding rate is usually positive. Longs have to pay, increasing the cost of holding a long position and giving the futures price more incentive to fall back.
Binance’s funding rate consists of two components: the premium index and the interest rate. The further the futures price deviates from the price index, the further the funding rate usually deviates from its baseline.
Looking at the market: $BTC is quoted at 81589.87 (24h: -0.6%).
For reference only, not investment advice.
My understanding is that when the futures price is higher than the spot price, the funding rate is usually positive. Longs have to pay, increasing the cost of holding a long position and giving the futures price more incentive to fall back.
Binance’s funding rate consists of two components: the premium index and the interest rate. The further the futures price deviates from the price index, the further the funding rate usually deviates from its baseline.
Looking at the market: $BTC is quoted at 81589.87 (24h: -0.6%).
For reference only, not investment advice.