How to Leverage on Structured Yield Vaults
Structured yield vaults on Prodigy.Fi offer flexible options for a wide range of users, combining high-yield opportunities, market positioning, and risk management.
Whether you are an aggressive yield seeker, a passive investor, or someone looking to hedge or speculate, DCI vaults provide versatile tools to meet your goals in a secure, decentralised manner.
This section explores how different types of users can leverage structured yield vaults for various use cases.
Please note: This guide is for educational purposes only and should not be considered financial advice.
1. Optimise For Yields
Users can optimise their yield strategy based on time horizon and risk tolerance. For short-term gains, choose vaults with shorter expiries and tighter linked Linked Prices to maximise yields.
For a more conservative approach, opt for longer tenured vaults with safer Linked Prices to steadily accumulate yield while preserving capital.
In general, the less conservative your target price, the higher the potential yield, allowing users to balance risk and reward according to their preferences.
How It Works:
Subscribe to vaults that are aligned with your market outlook.
Example: If you think ETH will remain above $4000, deposit USDC into a Buy Low vault with a 1-2 day expiry date at a Linked Price of $3950. If the market price remains above the Linked Price, you receive USDC principal plus yield.
Re-allocate your return into new short term, high yield vaults as they expire.
Benefits:
Earn consistent and attractive returns in both the short and long run.
Yields earned even if your chosen target price isn’t hit.
Flexible approach for active traders.
Consistent returns with minimal effort.
Reliable growth in volatile markets.
2. Accumulate Crypto Assets (Buy Low)
Earn income from accumulating your desired crypto asset (e.g ETH) at your desired price.
How it works:
Select a Buy Low vault with your target price to buy ETH at.
Example: Deposit USDC into a Buy Low vault for ETH.
If the market price of ETH reaches or goes below your target price upon expiry, buy ETH + earn yields.
If not, keep your USDC principal + earn yields.
Continue rolling yields into new vault subscriptions until the price target hits.
Benefits:
Earn yields while waiting for your target price to hit.
Build your crypto position in a capital efficient manner.
3. Take Profits On Your Crypto Assets (Sell High)
Sell your crypto assets at your desired target price while earning yields.
How It Works:
Select a Sell High vault with your target Linked Price.
Example: Deposit ETH into a Sell High vault.
If the market price of ETH reaches or goes above your target price upon expiry, sell ETH + earn yield
if not, keep your principal ETH + earn yields.
Continue rolling yields into new vault subscriptions until price target hits.
Benefits:
Earn yields while waiting for your price target to hit.
Sell at your target price with guaranteed yield.
4. Bet On Price Movements
Capitalise on short-term price movements with high-yield vaults.
How It Works:
Choose a Buy Low or Sell High vault that is expiring on the same day (0 Day-To-Expiry), and a tight price target
Example: Deposit USDC into a Buy Low vault expecting ETH to rise, or ETH into a Sell High vault expecting a drop, and avoid getting swapped.
Benefits:
High returns from short-term bets.
Yields even if predictions are wrong.
Fast-paced for active traders.
5. Hedge Assets For Risk Management
Take control of your strategy by becoming a Vault Creator. Set your own Linked Price and Expiry Date to hedge against market volatility and protect your holdings with precision.
How It Works:
Create a Buy Low or Sell High vault based on your protection goals.
Example: Hold ETH and create a Buy Low vault for USDC. If the crypto asset’s price falls below the Linked Price, your crypto asset is swapped into USDC at the linked price, mitigating volatility risk.
Benefits:
Capital protection from volatile markets.
6. Amplify Returns Without Liquidation Risk
Amplify returns from market movements without the risk of liquidation.
How It Works:
Create a Sell High to capture profits from the price difference between the current market value and the Linked Price of ETH at the vault's expiry.
Example: Create a Sell High vault for ETH. If ETH’s price reaches or exceeds the Linked Price by the expiry date, subscribers sell their ETH to you at the Linked Price, allowing you to acquire ETH at the lower Linked Price.
Benefits:
Amplify returns from price spreads by acquiring assets at a discounted Linked Price relative to the current market price, with yields capturing the upside potential from market movements while eliminating liquidation risk.
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