What is the Funding Rate Payment?
A mechanism to keep the Perpetual Futures price in line with the spot market through periodic credits/debits between long and short positions.Mark Price
Derived from publicly available orderbook data, such as a VWAP over a specific period (e.g., 3:45–4:00 PM London Time). The AX calculation methodology is available in Section 3.2. Mark Price Calculation in the Pricing Policy (https://architect.co/legal/ax-pricing-policy).Underlying Price
Sourced from independent benchmark providers (e.g., LSEG, S&P, ICE, NASDAQ) using a transparent calculation method.Frequency
Funding occurs daily (or as scheduled), excluding holidays and exchange closures.Processing Time
At each product’s published settlement time, funding payments are applied to all open positions. Each product’s settlement time is published on the Trade page’s Product Specs tab, as well as on the published Product Specifications List (https://architect.co/legal/ax-product-specification-list) Note that AX processes the funding payments on a few minute delay from the published actual funding time. For example for the FX perpetual funding at 4pm London time, the settlement price is struck at 4pm and the position size is taken at 4pm, AX receives the benchmark price from the external index provider up to 5 minutes later and at that time processes the funding payments.Tracking Mechanism
- If Mark > Underlying, longs pay shorts.
- If Mark < Underlying, shorts pay longs.
- The amount is proportional to the price difference, incentivizing price convergence.
Example
EUR/USD Perpetual Future:- Benchmark: 1.2000 USD/EUR (WMR rate)
- Mark Price: 1.2015 USD/EUR
- Difference: 0.0015 USD
This daily mechanism aligns the contract price with the underlying.