Earn yield while eliminating price exposure. Construct delta neutral positions for consistent returns.
strategyAdvanced60-90 minutes8 stepsPrerequisites: Understanding of perpetuals/futures, Multiple protocol experience, Risk management skills, Significant capital
On this page
Quick Overview
1Choose Strategy Type
2Calculate Position Sizes
3Open Long Leg
4Open Short Leg
5Verify Delta
6Monitor and Collect
7Manage Risk
8Exit Strategy
Delta neutral strategies generate yield while neutralizing exposure to price movements. You profit from funding rates, yield differentials, or arbitrage - not from price direction.
What is Delta Neutral?
Delta measures price sensitivity. A delta neutral portfolio has zero net delta - gains from longs offset losses from shorts (and vice versa).
Common Approaches:
Strategy
Long
Short
Yield Source
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Funding Arbitrage
Spot ETH
Perp Short
Funding rates
Basis Trade
Spot ETH
Future Short
Basis premium
Yield Farming
LP Position
Hedged Short
Trading fees
Risk Considerations
Funding rates can flip
Liquidation on short leg
Execution slippage
Counterparty/protocol risk
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Track your delta neutral strategies with Fensory. Monitor all legs.
Start Tracking →
Step-by-Step Instructions
1
Choose Strategy Type
Select between funding arbitrage, basis trade, or hedged farming based on market conditions.
Tips
✓Funding arb best with high funding
✓Basis trade needs futures premium
✓Check historical rates
2
Calculate Position Sizes
Long and short positions must equal in notional value for true delta neutral.
Tips
✓Account for fees in sizing
✓Consider leverage on short leg
✓Use spreadsheet to track
3
Open Long Leg
Buy spot asset or enter yield-generating position.
Tips
✓Spot is simplest
✓LP positions add yield but IL risk
✓Document entry price
4
Open Short Leg
Short same asset on perp exchange (GMX, dYdX) or futures.
Warnings
⚠Use low leverage to avoid liquidation
⚠Keep buffer for price spikes
⚠Monitor margin closely
5
Verify Delta
Confirm position sizes create net zero price exposure.
Tips
✓Small delta drift is normal
✓Rebalance if off by >5%
6
Monitor and Collect
Collect funding payments, yield, or fees. Monitor for rate changes.
Tips
✓Funding paid every 8 hours
✓Compound or withdraw yield
7
Manage Risk
Rebalance if delta drifts. Add margin if needed. Close if rates flip.
Warnings
⚠Negative funding = you pay
⚠Close before losses exceed yields
8
Exit Strategy
Close both legs simultaneously to lock in profits.