01Long Funding · Long YUBeginner
LONG YU
Pay fixed and receive floating to bet that funding settles above your entry rate.
Pay fixed · receive floating
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A practical framework for trading funding through fixed and floating rates — carry, basis, spreads, curves, events, and liquidity.
Every Boros position starts with one decision: pay fixed and receive floating, or receive fixed and pay floating. When you enter a YU position, the market's implied APR becomes your fixed rate.
The difference between the underlying funding you receive or pay and your fixed entry rate, accrued over the life of the position. Matters most if you hold to maturity.
The change in the position's value as implied APR moves before maturity — commonly called mark-to-market, or MtM, PnL. The fixed rate set at entry doesn't change, but the position's mark does. Matters most if you exit early.
Take a direct view on the level of a funding rate — or on where implied APR reprices next.
Pay fixed and receive floating to bet that funding settles above your entry rate.
Receive fixed and pay floating to bet that funding settles below your entry rate.
Ride continuation in implied APR as funding pressure persists.
Fade implied APR after it has overshot fair value.
Turn an uncertain funding cost or income stream into a more predictable fixed rate.
Cap a perp long's funding expense by fixing the rate you pay.
Lock the carry on a perp short into a fixed receivable.
Buy spot, short perp, and short YU to exchange floating funding income for a fixed stream.
Trade one funding rate against another. You only need to believe one rate is wrong relative to another.
Lock the difference between two venues' fixed rates with a four-leg, price-neutral package.
Go long one asset's YU and short another's to trade relative leverage demand.
Compare the Boros fixed rate against a dated future's annualized premium with a price-neutral package.
Trade differences between near-dated and longer-dated funding expectations.
Trade one expiry against another along the funding curve.
Own near-term funding pressure versus longer-dated rates ahead of a catalyst.
Position for elevated near-term rates to normalize toward the back end.
Own a favorable curve segment so the position rolls toward a better point as time passes — conditional on the curve staying broadly stable, not automatic yield.
Trade broader changes in leverage demand — catalysts, regimes, and baskets — rather than a single rate in isolation.
Isolate rate moves around a catalyst — long YU if it could push funding higher, short YU if a rollover, unlock, or unwind could push it lower.
Trade the funding response that may accompany a price move — not the asset's price itself.
Go long a basket of higher-beta YU markets in risk-on conditions, hedged with a short on richer rates.
Earn fees and incentives while taking on YU inventory and rate exposure.
Provide liquidity to earn fees and incentives while carrying YU inventory and rate exposure.
Quote around fair implied APR to earn spread while managing rate inventory.
Will underlying funding settle above or below my fixed entry rate?
Will implied APR move in my favor before I exit?
Am I being paid enough to hold the position?
Is one venue, asset, or instrument cheap or expensive relative to another?
Will one maturity outperform another?
Do fees and incentives adequately compensate for inventory and exit risk?
This framework makes Boros more useful, but not less risky — positions are margined, and being right eventually is not the same as surviving the path. Answer these before entering:
Strategy descriptions are educational frameworks, not guarantees of profit or individualized financial advice. Boros positions may involve leverage, mark-to-market losses, and liquidation risk.