Is holding a leveraged perp cheaper or more expensive than spot? Find the real cost difference.
A perpetual future has no expiry, so exchanges use a funding rate to keep its price near spot. Funding is exchanged directly between longs and shorts, typically every 8 hours. When funding is positive, longs pay shorts; when negative, shorts pay longs.
Spot buying has a one-time fee on entry and exit and no ongoing carry, but it ties up the full notional. A perp position posts only margin, yet pays funding on the full notional. At 10x leverage, a funding cost of 0.01% per 8h on notional is 0.1% per 8h against your margin — the same rate hurts far more per dollar committed.
Break-even is the price move needed to cover fees plus accumulated funding. It is roughly flat for spot but grows with each funding interval on a perp, which is why long-horizon exposure and short-horizon trading favour different instruments.
No. For short holding periods the perp can be cheaper because fees are charged on notional you never fully fund, and funding may even pay you if the rate is negative on your side. Cost crosses over as the holding period lengthens and funding accumulates.
Funding is charged on your position's notional value, not on your margin, so the dollar amount is the same at any leverage. Higher leverage only means that dollar amount is a larger share of the margin you posted.
Trading fees are paid once at entry and exit, but funding is charged every interval you stay open. Each interval adds to the total cost, so the price move required to break even keeps rising the longer the position is held.
New to this? Start with our free trading academy — every lesson links to a calculator.