What are the risks?

Market risk is managed through design, monitoring, and active rebalancing to maintain neutrality. However, unexpected events such as sudden volatility spikes, Hyperliquid downtimes, shallow market depth, latency issues, or sharp funding rate reversals can temporarily disrupt the balance between spot and perp positions, reducing or even negating expected yields. APY can swing more than diversified vaults that smooth returns with other yield sources. Funding spikes are short‑lived and compress with inflows; frequent switching compounds spread/fee drag, these tokens are designed for long term yield.