Spot or Futures? The Hidden Costs Behind Leverage
Crypto perpetual futures look tempting because leverage lets the same capital chase a much bigger return. But futures carry two costs that spot trading doesn't. The first is the funding fee, settled periodically for as long as you hold the position. The second is a liquidation zone that narrows sharply as leverage increases. Comparing only the headline return percentage between spot and futures makes it easy to miss both.
This calculator takes your investment amount, futures leverage multiplier, expected price change, average daily funding rate, and expected holding period, then compares your spot profit against your leveraged futures profit net of funding fees. It also shows, as an approximation that excludes maintenance margin details, how close your expected price change sits to the liquidation zone.
Actual liquidation prices depend on exchange-specific maintenance margin rates, isolated versus cross margin mode, and whether you add margin, so the liquidation reference here is approximate only. Leveraged trading carries the risk of losing your entire position, so confirm your exchange's exact liquidation calculator and risk management tools before trading with real funds.
Frequently Asked Questions
No. If price moves in your favor, leverage multiplies your gain, but funding fees accumulate over time and if price moves against you, losses are magnified by the same multiple, so futures isn't always the better choice.
Funding fees are settled periodically based on your total position value, so the higher your leverage, the larger the absolute fee for the same funding rate, which can significantly erode returns on longer holds.
Higher leverage narrows the price move needed to trigger liquidation. This calculator gives an approximate reference, excluding maintenance margin details, for how close your expected price change is to that danger zone.