Deposits Mid-Epoch
When a user deposits mid-epoch, he/she will not be entitled to the yield generated for the current epoch but his/her deposit will become active in case the vault is exercised (similar to a market limit order).
- 1.Initial ETH spot price= $1,200
- 2.A user deposits 1,000 USDC into the put-selling wheel vault during mid-epoch
- 3.The strike price of the put-sell option = $1,100
- 4.Weekly yield= 20%
- 5.The user does not initiate a withdrawal
- 1.The put-sell option expires worthless
- 2.Active position= 1,000 USDC
- 3.The user does not receive weekly profit (weekly yield)
- 4.Post settlement balance = 1,000 USDC
- 1.The put-sell option is exercised
- 2.Active position= 1,000 USDC
- 3.Profit = yield per epoch = 0
- 4.Post settlement balance of the active position = 1,000 USDC / $1,100 (strike price) = 0.9091 ETH (4dp)
- 5.Total post-settlement balance = 0.9091 ETH
- 6.The wheel vault then automatically changes from put-sell to covered call-selling mode
- 7.The user would now have a 0.9091 ETH active position in the covered call wheel vault and is earning yield in the form of ETH.
Last modified 7mo ago