$BMT latest funding rate: -0.133% (settled every 1 hour). Shorts pay, which works out to an approximate annualized rate of 1162.2% for this period.
Let’s use this figure to break down funding rates.
The annualized rate is simply the current rate multiplied over a year. The rate changes every period, so don’t treat it as a guaranteed annualized figure.
The further the rate strays from normal levels, the more crowded one side’s positions are. If the price moves in the opposite direction, the risk of cascading liquidations also increases.
Don’t let a single number disrupt your original strategy, and don’t use borrowed funds to test a thesis.
Let’s use this figure to break down funding rates.
The annualized rate is simply the current rate multiplied over a year. The rate changes every period, so don’t treat it as a guaranteed annualized figure.
The further the rate strays from normal levels, the more crowded one side’s positions are. If the price moves in the opposite direction, the risk of cascading liquidations also increases.
Don’t let a single number disrupt your original strategy, and don’t use borrowed funds to test a thesis.