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Wilmotter's/Curver'sI am trying to get my head around basis risk.what is it and how do we hedge it.let's say we have a DV01 of $$100 approximated by bumping a curve constructed from a USD swap curve +spread(basis).is it possible to divide my total DV01 exposure to swap curve DV01 && basis DV01 such that my Net DV01 is the sum of Both DV01's .for a swap portfolio what is the optimal way to estimate the basis risk ?Thanks,

These are dv01's in respect to different measures, so they aren't additive. For a fixed coupon bond your rate and basis dv01's should be about the same. Think of them as about any other greeks - you wouldn't want to add up your delta + vega to get "total risk".