Buy one unit of spot, short one unit of the perpetual. Price moves cancel between the legs, and each funding settlement pays the rate multiplied by notional as long as the rate stays positive on the venue where you are short.
Taker fees on both legs plus slippage on each side. At base tiers that is about 0.32% of notional round trip, so a 20% annualized rate needs roughly six days just to break even.
The rate flips sign, the basis widens and the short leg needs more margin, the venue halts withdrawals, or the contract gets delisted. Even an unlevered hedge carries liquidation risk if margin is thin relative to the move.
A 40% annualized rate on a $500 position earns about $0.55 a day. Two round trips of fees wipe out three weeks of that. Most retail losses in this strategy come from churning positions, not from picking the wrong coin.
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