Spot-perp carry

Buy spot, short the perp. Price risk cancels and the perp's funding becomes yield on hedged inventory.

Cash and carry

The classic structure: buy the asset on a spot market, short the same notional on a perp. The two legs offset every price move — you are flat the asset. If the perp’s funding rate is positive, the short leg collects it at every settlement while the spot leg just sits there. Funding becomes yield on fully hedged inventory.

A captured row: US on Gate spot against a KuCoin perp paying 0.342% per 8h to shorts — about 375% annualized at that instant’s rate. The rate will not hold for a year; see APR math for what that number does and does not mean.

Why carry differs from perp-perp funding trades

• One funding leg, not two. Spot earns no funding and pays none. The position collects the short perp’s rate, full stop — there is no second leg whose rate can flip against you at a different hour.
• Half the liquidation surface. Spot cannot be liquidated. Only the short perp carries margin risk, and it gains value when price falls — the dangerous direction is a rally, which lifts the spot leg’s value in step.
• Real inventory. You own the tokens. That means wallet transfers, spot withdrawal status, and — on some venues — the option to move inventory where the next carry is.

What to check before entering

• Funding sign and persistence. Carry pays only while the perp’s funding stays positive. A rate that flips negative turns the position into paying inventory. The Spread page shows 7-day sign persistence for exactly this check.
• Entry basis. Buying spot above the perp’s price is an up-front cost the funding must first repay.
• Spot liquidity. Spot books on small coins are often thinner than the perp’s. The exit — selling spot and buying back the short — pays slippage on both.
• Settle currency and lot sizes. The perp leg must be shortable at the size the spot leg buys, on a venue whose contract terms you have read.