📌 New series: 10 days — 10 rules of futures trading
Some costs are obvious.
Others quietly eat your results over time.
Today’s rule is about the one many traders underestimate 👇
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Day 5 / 10
Funding fees: the silent cost that reduces profitability
Most traders focus on:
• entry
• stop loss
• take profit
And almost ignore funding fees.
Then they wonder:
“Price barely moved,
but my PnL keeps decreasing.”
What funding really is (simple explanation)
Funding is a periodic payment between traders:
• longs pay shorts
• or shorts pay longs
It depends on market imbalance.
One payment isn’t the issue.
The problem appears when you hold positions for time
while funding works against you.
When funding becomes a real problem
• you hold a position for hours or days
• funding stays consistently negative for your side
• price moves slowly or goes sideways
In this case:
you might be right on direction,
but you’re paying for time.
How I manage funding
• I avoid holding positions long-term when funding is against me
• I always check funding time before holding overnight
• when funding is extreme, I look for opportunities
in the opposite direction
Most importantly:
if the market doesn’t move,
I don’t feel forced to stay in the trade.
Key point
Funding is not a “small detail”.
It’s a real trading cost — just like fees or slippage.
You either:
• account for it in your plan
• or let it quietly reduce your edge
Conclusion:
Funding doesn’t make a trade bad.
But ignoring it can make a good trade less profitable.
Next post:
why taking partial profits and moving to breakeven
helps traders survive over series of trades.
#FutureTarding