The Dirty Hedge — Partial Hedging

Hold the position, and run a standing short at a fraction of its size. That fraction is the whole decision — and it makes this the simplest risk-softener in the series.

// WHAT IT IS

Hold the position (LP or spot) + a standing short at a FRACTION of its size — commonly 30–50%.
Every drawdown is softened by the fraction; most upside is kept.
The short earns funding whenever longs are paying — protection that can pay rent.
The simplest risk-softener in the series: a slider between "all upside, all risk" and the full delta-neutral.

// READ THE TREND FIRST

Delta-Neutral LPOPEN →

The full version of this hedge, run at 100% of the position.

// WHEN PEOPLE RUN IT

When the daily read is BULLISH but they want the drawdowns dulled without giving up the trend.

// OPEN THE FUNDING BOARD

Reading THE FRONTOPEN →

Where the daily read comes from — the check every page in this series starts with.

// THE WALKTHROUGH

1. Confirm the read.

The WAR TRENDS daily board with the XAU BULLISH badge boxed — // example — the trend state changes constantly

2. Read the funding.

The funding board in table view with a positive funding rate ringed and called out as the rate the partial short is paid — // example — rates change constantly

3. The fraction is the whole decision — a 30% short means 70% of the move in both directions, plus funding on the 30%.

// WHAT CAN GO WRONG

Funding flips — the protection starts costing.
It's a softener, not a floor — a 40% hedge still eats 60% of every drop.
Discipline drift — resizing the fraction after every move quietly becomes directional trading.
Liquidation on the short leg still exists at any fraction.

// OPEN SPOT CARRY

// THE MATH BOX

Position $10,000, short fraction 40% → a 10% drop lands as ≈6% on the combined position; funding earned on the short leg at +36.79% APR while it's on.

Example — rates change constantly.

// NOTICE FROM THE FORGE

// OPEN THE BOARD