$XEC Current funding rate: -0.5% (settled every 4 hours). Shorts pay; simply annualized based on this period, it’s about 1095.9%.
When I was new to futures trading, I always thought the platform collected the funding fee. Later, I learned that funding fees don’t go to the exchange—they’re transferred between long and short position holders. Who pays and who receives depends on whether the rate is positive or negative.
The rate only reflects the balance of long and short positions in the futures market; it doesn’t indicate the strength of spot demand.
The same data can mean completely different things in different market conditions, so don’t blindly apply a single rule.
#XEC
When I was new to futures trading, I always thought the platform collected the funding fee. Later, I learned that funding fees don’t go to the exchange—they’re transferred between long and short position holders. Who pays and who receives depends on whether the rate is positive or negative.
The rate only reflects the balance of long and short positions in the futures market; it doesn’t indicate the strength of spot demand.
The same data can mean completely different things in different market conditions, so don’t blindly apply a single rule.
#XEC
