Yesterday a teammate asked me a question: Why did the system deduct my money when I was playing a contract?
The captain didn't know whether to laugh or cry! ! !
The gain or loss of this money is due to the expenditure or income of the funding rate. In perpetual contract trading, as long as you hold a position at 0 o'clock, 8 o'clock, and 16 o'clock, you will definitely spend or earn funding fees.
Why does funding appear? The main function of funding is to anchor the contract price and the spot price. It is a method of adjustment.
Interested friends can go to Binance to check any currency at any time. There must be a difference between the spot price and the price in the contract. The larger the price difference, the higher the funding rate will be.
The rise and fall of any trading market target is determined by buying and selling. If there are many buyers, the price will rise; if there are many sellers, the price will fall. If the contract price is too far away from the spot price, it is a false target, a pig-killing scheme. The price is arbitrarily customized by the platform, and the authenticity of the transaction is lost.
Therefore, the funding fee is a method of adjusting money in order to balance the long and short positions.
Everyone is opening long positions to buy stocks, while a few are opening short positions to buy stocks. The system will make those who open long positions to buy stocks pay those who open short positions.
Everyone is shorting to go down, and a few are long to go up. The system will make those who short to go down pay those who go up.
Players who play hedging and arbitrage are very clear about how stable and high the yield of funding rate arbitrage is, but hedge arbitrage is only for a niche circle of players (it is not publicized to the public because of its limited size). Methods include making profits from the price difference between spot and spot across platforms, commonly known as brick-moving arbitrage, as well as hedging between futures and spot, and hedging between futures and futures.
Brothers who want to learn about funding rate arbitrage and hedging arbitrage methods, please follow me
In the next issue, the captain will analyze several hedging and arbitrage methods. #加密大队长 #非农人数大幅升温 #资金费率