Perpetual-Style (aka "Continuous") Futures are a new kind of long-dated futures contract—ranging from 5 to 10 years depending on the exchange—which eliminate the need for regular contract rollovers. These contracts closely track the underlying asset's spot price through a funding rate mechanism.
What are Perpetual-Style Futures?
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What are the trading hours for these contracts?
The trading hours for Perpetual-Style futures can vary depending on the exchange.
Coinbase Derivatives Exchange:…
Perpetual-Style Futures Disclosure
Perpetual-Style Futures are long-dated futures products that contain a funding rate component. Unlike conventional short-dated futures, Perpetual-Style Futures allow traders to hold positions for an extended period.
The funding rate is a mechanism used in Perpetual-Style Futures markets to keep the contract's price in line with the underlying asset's spot price. On an on-going basis, at intervals determined by the relevant exchange, funding payments are made between participants who have a position on the Perpetual-Style Futures market based on the funding rate:…
How is my volatility being calculated?
Implied volatility measures the uncertainty of the underlying's price implied from the options prices.
Implied volatility is calculated using a 100-step binary tree for American style options, and a Black-Scholes model for European style options. Interest rates are calculated using the settlement prices from the day’s Eurodollar futures contracts, and dividends are based on historical payouts…
What is the funding rate and why does it exist?
The funding rate is a percentage-based rate derived from the average difference between the futures price and the spot price over a time period determined by the exchange. It exists to keep the futures price closely aligned with the spot price by periodically transferring value between long and short positions…