Volatility-Hedged Yield Maximization Strategy

An example strategy that can be created using A51.

Objective:

To maximize yield while hedging against extreme price volatility in a given token pair, say ETH/USDC.

ETH Price = $1,500

Market Mode

• Bull Mode: When ETH price rises by more than 5%, rebase the position to capture more of the upside.

Rebasing Mechanism

• Rebase Preference: 5%, liquidity needs to be in range.

Exit Strategy:

• Reverse Liquidation: Automatically sell all of USDC and convert it to ETH if it reaches $1,800.

• Smart Exit: Convert all of ETH back into USDC if ETH reaches $2,000

• Exit Preference: Automatically withdraw liquidity if the price of ETH drops to $1,300.

Liquidity Distribution:

• Exponential Symmetrical: Distribute the liquidity in an exponential symmetrical way.

Additional Features:

• Farming Rewards: Lock NFT received from liquidity provision to receive additional farming rewards.

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This strategy aims to balance the pursuit of high yields with risk mitigation, making it suitable for LPs who have a moderate risk tolerance and are looking for both capital appreciation and income.