Funding Rate Fun on Zeta Markets

BbyA...nMtW
11 May 2024
326

If you haven't seen my explainer post about perps via Zeta Markets please make sure you read that if you're unfamiliar with this product.
https://www.bulbapp.io/p/386d2cd3-30a5-4da6-a9e8-0c4ad1482a2c/zeta-markets-a-beginners-guide-to-perps?s_id=bf776ec2-7751-4f1e-85b1-586e3b826379

Perps are risky. Like really risky. It's easy to lose money quickly on them.
The strategy I'm talking about below involves taking long term positions, at leverage, with either no SLs in place or very expensive ones. So there is a high risk of losing significant funds.


Funding Rates as Long Term Yield Bearing Positions

Perps are normally a shorter term trade than an LP (liquidity pool). The profit is from the price, not the fees. But you can treat perps like an LP, and earn from fees, if you're prepared to take on some considerable risk doing so.

Sitting in a position long term can be profitable if the funding rate is in your favour. You've just got to be able to not get liquidated doing it, and that can be super risky as, unlike IL (impermanent loss) in a LP, liquidations take all your position; not just some of it.

Negative funding rates pay Longs fees


Positive funding rates pay Shorts fees



Let's look at some of the better funding rates on Zeta Markets right now.


STRK-PERP

https://dex.zeta.markets/trade/STRK-PERP

Sitting Long $STRK has been profitable for a while, and $STRK isn't exactly hitting all time highs right now either.




WIF-PERP

https://dex.zeta.markets/trade/WIF-PERP

Short $WIF paying good returns and has been for a while. If you look closely you see that's where I'm hanging out currently. Probably one of the more risky things you can do is short a memecoin. But hey: If they're paying me to do so..





JUP-PERP

https://dex.zeta.markets/trade/JUP-PERP

Short $JUP a good return at present.





SOL-PERP

https://dex.zeta.markets/trade/SOL-PERP

Short $SOL has whipsawed to the Long side a couple of times but mostly it's been pretty good returns of late.






Over to you

Do you use perps?
What are some of the strategies you like to use?
Let me know in the comments.


And if you're interested in trading perps, I have a referral for you (which comes with a little boost!)
https://dex.zeta.markets?r=grtcak





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