Is cash-and-carry risk-free?

No. It removes most directional price risk while keeping funding or basis risk, liquidation risk on the derivative leg, execution costs and counterparty risk. Its return is also variable in the perpetual version, because funding changes.

Why does the trade exist at all?

Because demand for leveraged long exposure often pushes derivatives above spot. The carry trader supplies the other side of that demand and is paid through the premium or the funding, which is also what pulls the derivative price back toward spot.

Cash-and-carry trade (basis trade)

A cash-and-carry trade buys an asset in the spot market and sells a futures or perpetual contract on the same asset, so that price moves largely cancel and the position earns the basis or the funding payments instead. It is often described as market neutral, but it carries funding, margin, execution and counterparty risks of its own.

Senzoukria · Glossary · Updated September 2026

Two versions

With a dated future: buy spot, sell the future at a premium, hold to expiry. The two converge, and the premium at entry, minus costs, is the result.
With a perpetual: buy spot, sell the perpetual. While funding is positive, the short receives it at each funding time; the result depends on funding over the holding period, which is not fixed in advance.
The reverse, selling spot and buying the derivative, applies when the derivative trades at a discount or funding is negative, and requires borrowing the asset.

A worked example

A trader holds 1 BTC bought at 60,000 USDT and shorts a perpetual position of 1 BTC. If the funding rate is +0.01% per 8-hour interval and the notional stays near 60,000, the short receives about 6 USDT per interval, 18 USDT per day, before fees. A 1,000-point move in BTC changes the spot leg and the short leg by roughly equal and opposite amounts. The figures are illustrative: funding changes every interval and can turn negative, at which point the short pays instead of receiving.

The risks that remain

Funding risk: the perpetual version's income is variable and can become a cost.
Margin and liquidation: the short derivative leg can be liquidated in a sharp rally if its margin is insufficient, even though the spot leg has gained, when the two legs sit in separate accounts or on separate venues.
Basis risk: before expiry, the premium can widen against the position, producing mark-to-market losses.
Execution and fees: two legs to enter and exit, each paying fees and slippage.
Counterparty and venue risk: the position depends on the exchanges holding both legs.
Crowding: when many traders run the same carry, its return compresses.

In Senzoukria

The desktop reads crypto spot and perpetual markets for analysis only: it has no crypto order routing, holds no crypto position and displays neither funding rates nor basis series. What it offers for this kind of reading is separate order flow for Binance Spot and Binance USD-M perpetuals, so the aggression on each leg's market can be compared. This page describes a mechanism, not a recommendation to trade it.

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Frequently asked questions

Is cash-and-carry risk-free?: No. It removes most directional price risk while keeping funding or basis risk, liquidation risk on the derivative leg, execution costs and counterparty risk. Its return is also variable in the perpetual version, because funding changes.
Why does the trade exist at all?: Because demand for leveraged long exposure often pushes derivatives above spot. The carry trader supplies the other side of that demand and is paid through the premium or the funding, which is also what pulls the derivative price back toward spot.

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