The Cost to Carry plays a crucial role in determining the feasibility of leveraged trading and long-term asset holding. Traders use this metric to evaluate the true cost of maintaining a position, which directly impacts profitability. In futures markets, cost to carry influences pricing and arbitrage opportunities. A rising cost to carry may discourage traders from holding positions, while a declining cost may create opportunities for long-term investments. By factoring in cost to carry, traders can optimize trade execution and risk management strategies.