Funding Rate Calculator — Perpetual Futures Costs & Income

Enter your position size in USD — this is the notional value of your perpetual futures position, not the margin. For example, if you open a $10,000 BTC-PERP position with 10× leverage, your notional size is $10,000 and your margin is $1,000. Funding is always calculated on the full notional.

Next, enter the funding rate per interval as a percentage. This is the rate shown on your exchange (e.g. Binance, Bybit, OKX) next to the perpetual contract. A typical rate is 0.01% per 8 hours. Funding rates can be negative — enter a negative value if the rate is below zero (meaning shorts pay longs).

Select the funding interval — most major exchanges settle funding every 8 hours (3× per day). Some exchanges use 4-hour or 24-hour intervals. Then select your position side (Long or Short) and the number of holding days. Click Calculate Funding Cost to see how much you will pay or receive over the holding period, broken down by interval, day, week, and month.

Perpetual futures funding is a periodic payment between long and short traders to keep the perpetual contract price anchored to the spot price. The calculation is straightforward:

• Intervals Per Day = 24 / Funding Interval Hours (e.g. 24 / 8 = 3 for 8-hour funding)
• Cost Per Interval = Position Size (USD) × Funding Rate (%) / 100
• Cost Per Day = Cost Per Interval × Intervals Per Day
• Total Cost = Cost Per Interval × (Holding Days × Intervals Per Day)
• Annualized Funding Rate = Funding Rate × Intervals Per Day × 365

Who Pays Whom?

• Positive funding rate: Long traders PAY short traders. The perpetual is trading at a premium to spot — the market is bullish.
• Negative funding rate: Short traders PAY long traders. The perpetual is trading at a discount to spot — the market is bearish.

A 0.01% per 8-hour rate annualises to 10.95% (0.01% × 3 × 365). This means holding a $10,000 long position costs ~$1,095 per year in funding at a constant 0.01% rate — a significant drag that traders must factor into their holding cost analysis.

Example 1 — Typical Bull Market: Long BTC-PERP for 7 Days

• Position Size: $10,000 | Funding Rate: +0.01% per 8h
• Funding Interval: 8 hours (3× per day) | Side: Long
• Holding Period: 7 days
• Cost Per Interval: $1.00 | Cost Per Day: $3.00
• Total Cost: $21.00 (you pay)

During bull markets, funding rates frequently spike to 0.05–0.1%+ per 8 hours on BTC and ETH perpetuals. At 0.1%/8h, the same position costs $10/interval, $30/day, and $210 over a week — materially eating into profits on leveraged long positions.

Example 2 — Negative Funding: Short ETH-PERP for 14 Days

• Position Size: $25,000 | Funding Rate: −0.02% per 8h
• Funding Interval: 8 hours | Side: Short
• Holding Period: 14 days
• Income Per Interval: $5.00 | Income Per Day: $15.00
• Total Income: $210.00 (you receive)

During bear markets or corrections, funding can turn negative, meaning shorts receive funding payments. Traders sometimes open short positions purely to collect negative funding — a strategy known as funding rate arbitrage or cash-and-carry when hedged with a spot long.

Example 3 — High Leverage Scalp: $100,000 Notional for 1 Day

• Position Size: $100,000 | Funding Rate: 0.05% per 8h
• Funding Interval: 8 hours | Side: Long
• Holding Period: 1 day
• Cost Per Interval: $50 | Cost Per Day: $150
• Total Cost: $150 for one day

Even short holding periods can produce meaningful funding costs at high notional sizes. A $100,000 position at 0.05% funding costs $150 per day — equivalent to needing a 0.15% price move just to break even on a zero-commission trade.

Cash-and-Carry Arbitrage with Funding Rates

A popular market-neutral strategy: buy $10,000 of BTC on spot and simultaneously short $10,000 BTC-PERP. You are price-neutral (spot gains and perp losses cancel), but you collect funding when the perp rate is positive. At 0.03%/8h, you earn 0.09%/day = ~32.85%/year on the notional — risk-free if managed properly. This is why funding rates compress toward zero over time as arbitrageurs enter the trade.