Strategy Patterns: Mean Reversion, Funding-Rate, Stat Arb

What you'll learn

• The Major On-Chain Strategy Families
• Funding-Rate Arbitrage: The Core Trade
• The Perp DEX Landscape: Hyperliquid, dYdX, GMX, Drift, Aevo
• Mean Reversion: Bollinger and Z-Scores
• Momentum, Breakouts, and Statistical Arbitrage
• Putting Strategies Together: The Multi-Strategy Book

Key terms

Funding rate

Periodic payment between perp longs and shorts that anchors the perp price to spot. Positive funding means longs pay shorts; negative means shorts pay longs. The basis for funding-rate arbitrage.

Funding-rate arbitrage

A delta-neutral strategy that shorts a perp paying positive funding while going long the spot (or another lower-funding perp). Collects the funding spread minus costs.

Hyperliquid

Dominant decentralized perp venue by 2025, ~70%+ share of decentralized perps volume and ~$5B+ daily volume. Runs on its own L1 with a CLOB exchange. HYPE token launched late 2024.

dYdX v4

Perp DEX migrated to a Cosmos SDK app-chain (dYdX Chain) in late 2023. Validator-run in-memory CLOB with off-chain matching and on-chain settlement.

GMX

Pooled-liquidity perp DEX on Arbitrum and Avalanche. Traders trade against the GLP/GLV pool rather than an order book. GMX V2 introduced isolated markets.

Drift

Leading perp DEX on Solana, using hybrid CLOB + AMM model to leverage Solana's low fees and fast block times.

Aevo

Perp and options DEX descended from Ribbon Finance, running on its own optimistic rollup. Strongest on options markets.

Bollinger Bands

Mean-reversion indicator placing bands at rolling mean ± k standard deviations (typically k=2, 20-period window). Closes outside bands signal expected reversion.

Statistical arbitrage

A strategy family that models structural relationships between assets (cointegration, peg-like dynamics) and trades departures from the model. Common candidates: stETH/ETH, WBTC/BTC, cross-chain wrappers.

Multi-strategy book

An operation running several imperfectly correlated strategies (funding-rate arb, mean reversion, breakout, stat arb) in parallel to smooth returns and reduce single-strategy drawdown risk.