Buy Low and Sell High Examples
Last updated
Last updated
With Buy Low, users can buy WETH with USDC by choosing a Linked Price that is set below the current market price.
In this example, the current price of ETH is $3,200, and Subscribers choose to buy WETH at a linked price of $2,900. The user deposits $10,000 USDC into a Buy Low vault with an APY of 772.94%.
The following scenarios are possible:
Scenario 1: On the expiration date, if the market price is less than or equal to $2,900, he will receive WETH at the Linked Price of $2,900. In addition, he will earn rewards in WETH, bringing the total to 3.758 WETH [3.123 WETH (Principal) + 0.635 WETH (Yield)].
Scenario 2: On the expiration date, if the market price is above $2,900, he will get back his principal of $10,000 USDC. In addition, he will earn USDC reward at 772.94% APY, bringing the total to 10,900 USDC [10,000 USDC (Principal) + 900 USDC (Yield)].
With the Sell High, Subscribers can sell WETH for USDC by choosing a Linked Price that is set above the current market price.
In this example, the current price of WETH is $3,200, and he wants to sell at a linked price of $3,500. He deposits 10 WETH into a Sell High vault with an APY of 755.17%.
The following scenarios are possible:
Scenario 1: On the expiration date, if the market price is below $3,000, he will get back his principal of $10 WETH. In addition, he will earn WETH reward at 755.17% APY, bringing the total to 11.5 WETH [10 WETH (Principal) + 0.5 WETH (Yield)].
Scenario 2: On the expiration date, if the market price is greater than or equal to $3,500, he will receive USDC at the Linked Price of $3,500. In addition, he will earn rewards in USDC, bringing the total to 40,250 USDC [ 35,000 USDC (Principal) + 5,250 USDC (Yield)
