What’s Futures Funding Fee

What is Funding Fee?

The funding fee is a periodic payment made by position holders either to traders that are long or short, based on the difference between futures perpetual contract market price and spot price.

CoinEx has introduced Funding Fee system to ensure that the Futures market price remains close to Spot market price, and it can prevent lasting divergence in the price of both markets.

The funding rate will be calculated every minute. The funding fee will be paid/received every 8 hours, and traders will only pay or receive funding fee if they hold a position at the time of settlement. When the funding rate is positive, long position holders will pay the funding fee to short position holders. Likewise, when the funding rate is negative, short position holders will pay the funding fee to long position holders. Funding fees are paid peer-to-peer. Therefore, CoinEx takes no fees from funding fees as they happen directly between users.

Calculation

Funding Fee = Position Amount * Mark Price * Funding Rate

Settlement Time of Funding Fee

Everyday 00:00, 08:00 and 16:00 (UTC)

How to Collect Funding Fee

1. Cross Margin Mode

The funding fee will be directly deducted from users' realized PNL. If the margin rate reaches the sum of the maintenance margin rate and closing fee rate, the excess part will not be deducted.

2. Isolated Margin Mode

The funding fee will be preferentially deducted from users' realized PNL. If the realized PNL is not enough, the excess part will be deducted from the fixed position margin. If the margin rate reaches the sum of the maintenance margin rate and closing fee rate, the excess part will not be deducted.

Notes

1. The funding fee will be charged according to the funding fee rate calculated one minute before the last timestamp.

For example, when settling at 08:00 (UTC), the funding fee will be charged based on the funding rate at 23:59 (UTC) the day before.

2. The actual amount of Funding Fee that can be charged each time depends on the total amount that can be systematically deducted from the payers' accounts.