If the sequence you are using is non-maximal (i.e. Not an m-sequence), the code may be highly imbalanced (a lot more ones than zeros, or vice-versa), which can cause a significant carrier component to appear. This is normal.
But if the sequence is an m-sequence, you may have a defective mixer. Or you may be connecting the generator to the mixer incorrectly. Refer to the FAQ on mixer connections for instructions on driving a double-balanced mixer.
If you still have a problem after confirming correct mixer setup, and you're sure you are generating an m-sequence, the problem may be due to carrier imbalance. Refer to the FAQ on carrier imbalance for more information. More.
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