When trading perpetual contracts, many people only focus on market trends but overlook a hidden cost killer—the contract transaction fee. I also suffered from this initially; after one trade, I realized the fees ate up a significant portion of the profit.

The costs of perpetual contracts mainly fall into two categories: trading fees and funding rates. First, let's talk about trading fees, which are the most straightforward costs. Maker orders usually cost 0.02%, while market orders (taker) are 0.05%. Many people don't understand the difference; simply put—placing an order manually at a specific price counts as a maker order, while an order executed immediately at market price counts as a taker order.

Calculating contract fees is very simple: it’s the position value multiplied by the fee rate. Let me give you an example: suppose you use 100x leverage with a principal of 600 USD, then your position value becomes 60,000 USD. Opening a position costs 60,000 USD × 0.05% = 30 USD in fees, and closing the position also costs 30 USD. If you use a limit order to close and save some fees, it might only be 12 USD. From entry to exit, a single contract fee can range from 24 to 60 USD, and this is just one trade. If you trade long-term, these fees accumulate into a huge expense.

Besides trading fees, there's an even more hidden cost—funding rates. This rate is not fixed; it depends entirely on the market’s long-short ratio. When the market is overly bullish, the funding rate becomes positive, meaning long holders pay money, while short holders can earn. Conversely, the same applies when the market is overly bearish. Funding rates are settled three times a day (00:00, 08:00, 16:00), and only positions held at these times will be charged or credited accordingly.

So, trading perpetual contracts isn’t just about choosing the right direction; you also need to carefully consider contract fees and funding rates. Especially when using high leverage, the cost can become terrifying. Now I always calculate these hidden costs before trading to decide whether to enter the market.