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Support CenterOperation guideIntroduction to Futures Funding Rates
Introduction to Futures Funding Rates
2022/03/02 20:00:56

Please check our tutorial video to help you solve your problems or understand more regarding related topics.

If you would like to know more details, please read the whole article below.


Here is our tutorial video:

The U-futures contract adopts the funding rate to ensure that perpetual contract prices correspond to the spot prices. Funding payments occur every 8 hours.

Traders are only liable for funding payments in either direction if they have open positions at the pre-specified funding times. If traders do not have a position, they are not liable for any funding. If you close your position prior to the next funding time, you will not pay or receive any funding.

For calculating the funding fee, when the funding rate is positive, traders who are long on perpetual contracts will pay a funding fee to traders on the opposing side. Conversely, the funding rate will be negative when traders who are short a perpetual contract will pay a funding fee to long traders.

Please note that our platform takes no fees from funding rate transfers as funding fees are transferred directly between traders.

1. Formula of Funding Fee

Funding Fee = Value of Positions × Funding Rate

Funding Rate = Clamp(MA(( (Bid Price + Ask Price)/2-spot price index)/spot price index - Interest)*100%,a,b)

*Interest is currently zero

The values of a and b are as follows:

[Above info and index can fluctuate without notice due to factors such as volatile market price.]

Funding rate will be calculated every 8 hours at 00:00 SGT; 08:00 SGT and 16:00 SGT for all U-futures perpetual contracts to charge the funding fee.

2. Actual Funding Fee

(1) Calculation Rule of the Funding Fee

a. Funding Fee in the cross margin will be directly deducted from the trader’s account balance. As in the isolated margin, the funding fee will be deducted from your maintenance margin of your isolated position.

b. After deducting the funding fee, the trader’s balance margin is less than or equal to the maintenance margin, the system will continue to auto deleveraging or liquidate until it meets the required level.

(2) The actual funding fee that traders can receive depends on the actual amount of funding fees that the system deducts from the opposing account.

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