Funding Rates and Trend Holding
How perpetual futures funding rates can affect Turtle-style trend following in crypto markets.
Perpetual futures introduce a cost or income stream that traditional spot charts do not show. Funding rates can matter when a trend-following system holds positions for days or weeks.
What funding changes
Funding can reduce the profitability of a correct directional trade if the position pays expensive funding for a long time. It can also make crowded positions more fragile when fees become extreme.
What to record
The trading journal should include:
- funding paid or received;
- whether funding was unusually high;
- whether funding changed the decision to include the market;
- whether backtests model funding realistically.
Risk boundary
Funding should not be used as a standalone prediction tool inside a Turtle system unless it is formally defined and tested. It is first a cost and risk variable.