Work it out
The starting values are an illustration, not a suggested trade or allocation.
Your inputs are not sent to a server or stored by this calculator.
Worked example
A 0.01% interval rate costs a long 1 unit per 10000 notional. Three settlements cost 3. Simple annualization is 0.01×3×365 =10.95%.
Identify what rate the venue displays
A displayed percentage may describe one interval or an annualized convention. The input here must be the percentage for one actual settlement interval. Do not paste an annual rate into the interval-rate field.
Read the contract’s current funding rules. Different products and venues can use different intervals, reference prices and eligibility conditions.
Keep the sign convention visible
In this model a positive interval rate makes a long position pay and a short position receive. A negative rate reverses those directions. Positive signed cost means an expense; negative signed cost means a receipt.
Funding received is not the total return of the position. An adverse price move or other costs can exceed a funding receipt.
Count settlement events directly
The total is constant notional × interval rate × settlement count, with the side determining the sign. Enter the number of events for which the position is assumed eligible.
Hours held alone do not establish this count. Opening shortly before a settlement and closing shortly afterward can differ from holding for the same elapsed time between settlements.
Annualization is simple, not compounded
The displayed annualized rate is interval percentage ×24/interval hours ×365. It is a scale conversion under a constant-rate assumption. It does not reinvest receipts or increase the notional after payments.
For example, 0.01% every eight hours becomes 10.95% on this simple annual scale. That number is not a forecast of the next year’s rate or an achievable investment yield.
Replace the estimate with an actual ledger
For realized funding, collect the venue’s individual settlement records with their rates, notionals and cash flows. Sum those actual payments instead of applying one rate to the entire holding period.
The present calculator is a sensitivity example. It excludes price P/L, changing position size, compounding, fees, basis changes and taxes.
What this tool does not calculate
- Constant user-entered rate and notional; no prediction or compounding.
- Verify whether the venue displays an interval rate or an annualized rate before using it.
Common questions
Is the annualized number an APY?
No. It is a simple annualized interval rate with no compounding and no forecast of future funding.
Can I enter a negative funding rate?
Yes. The payment direction reverses. The output states whether the model gives a payment or receipt for the selected side.
Why enter the settlement count manually?
Eligibility depends on actual settlement timestamps and contract rules, not only on elapsed hours.
Sources & method
- Coinbase International: funding mechanism and signed cash flows
- Coinbase Institutional: funding interval conventions
An original calculation tool built with AI assistance. Its method and limits are documented here, and calculation examples are checked with automated tests.
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