Systemic Carry represents the aggregate financial cost or benefit associated with holding a position in a financial asset or portfolio over a specified duration, arising from the inherent structural attributes and interdependencies of the broader market or financial system. In crypto, this often encompasses funding rates on derivatives and staking yields.
Mechanism
Systemic carry manifests through various components, including interest rate differentials, dividends from equity or tokenized assets, funding rates applied to perpetual swap contracts, and staking rewards from proof-of-stake networks. These elements collectively contribute to a net carry cost or income, influenced by overall market liquidity, demand, and prevailing risk premiums across interconnected crypto markets.
Methodology
Calculating systemic carry involves comprehensively accounting for all recurring income streams and borrowing costs across an entire investment portfolio or specific asset classes. This provides a holistic view for sophisticated risk management and strategy optimization, enabling institutional investors to precisely assess the structural profitability or inherent expense of their digital asset holdings and derivative positions.
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