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What Is the Difference between the Premium Index and the Funding Rate?

Premium Index is the raw price deviation; Funding Rate is the final payment percentage incorporating the index and interest rate.
Greeks.Live22.11.25

What Is the Difference between the Premium Index and the Funding Rate?

The Premium Index is a component used to calculate the Funding Rate. It measures the difference between the perpetual contract's Mark Price and the Index Price.

The Funding Rate is the final calculated percentage that is applied to a trader's position, and it incorporates the Premium Index along with an Interest Rate Component. Essentially, the Premium Index is the raw price deviation, while the Funding Rate is the actionable fee/payment percentage.

What Is the “Index Price” and How Is It Used in the Funding Rate Calculation?
Why Is It Dangerous to Sign the Raw Transaction Data Instead of Its Hash?
Does a Significant Deviation between the Index Price and the Contract Price Always Trigger a Liquidation?
What Is the Calculation Formula for the Funding Payment?

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