> For the complete documentation index, see [llms.txt](https://docs.aevo.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.aevo.xyz/aevo-products/aevo-strategies/aevo-basis-trade.md).

# Aevo Basis Trade

Aevo Basis Trade will be collecting funding payments by simultaneously buying spot and selling a perpetual future contract for the same asset against it.

The vault does not take any directional exposure (**delta-neutral**), as every long spot position is balanced by a short perpetual future position.

The vault is expected to perform positively as long as the funding rate is positive.

The Strategy execution is **fully algorithmic** and continuously monitored by our risk team.

## Trade Rationale

Spot and future contracts prices diverge based on demand and supply dynamics, this differential is known as the “basis”.

To ensure their convergence, periodic payments are made between traders who hold positions in perpetual futures contracts. These payments are referred to as funding payments.

Based on the differential between index price (spot) and mark price (perpetual future price), the funding rate will be either negative or positive:

* Positive funding rate: Long position holders pay short position holders
* Negative funding rate: Short position holders pay long position holders

## Backtest and initial run

Aevo Basis Trade has been running since June 01 and has been backtested for 1 year, producing the following results:

<figure><img src="/files/YCgUwdaPHvNWAFPzx82r" alt=""><figcaption><p>1 year Aevo Basis Strategy backtest</p></figcaption></figure>


---

# Agent Instructions
This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com.

## Querying This Documentation
If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter:

```
GET https://docs.aevo.xyz/aevo-products/aevo-strategies/aevo-basis-trade.md?ask=<question>&goal=<endgoal>
```

`ask` is the immediate question: it should be specific, self-contained, and written in natural language.
`goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal.

The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.