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What Is the Consequence of a Negative Funding Rate for a Long Position Holder?

A long position holder is paid the funding rate by short position holders. This payment acts as a small positive return on the position, effectively reducing the cost of maintaining the long.

However, this payment is often outweighed by the negative price movement that typically accompanies a negative funding rate.

Explain the Function of the “Funding Rate” in Perpetual Futures
What Is the Practical Implication of High Gamma for a Short-Term Option Holder?
How Do Perpetual Swaps Maintain a Price Close to the Underlying Spot Price without an Expiration Date?
What Mechanism Replaces Expiration for a Perpetual Option?