GMX Delta Neutral (Alpha test)

Earn #RealYield on GMX with neutralized risks

TL;DR

Provide liquidity on GMX (an on-chain leverage trading platform) via $GLP pool to earn yield and neutralize price risk using borrows from AAVE.

Protocol Integration

GMX https://gmx.io/
AAVE https://aave.com/

Details

What is GMX/GLP?

GMX is a decentralized spot and perpetual exchange that supports low swap fees and zero price impact trades. Trading is supported by a multi-asset pool ($GLP) that earns liquidity providers fees from market making, swap fees, leverage trading (spreads, funding fees & liquidations) and asset rebalancing.

$GLP is a pool of blue chip tokens used to provide liquidity for trading within GMX. It consists of ~50% of volatile assets ( 30% $ETH + 17% $BTC + $LINK + $UNI ) and ~$50% of stable-coins. Traders trade against the pool and pay platform fees. 70% of the fees is distributed to $GLP holders in form of $ETH/$AVAX and esGMX (see https://gmxio.gitbook.io/gmx/rewards). We will only consider the $ETH/$AVAX portion of the yield in our strategy.

Risks from holding GLP

Price exposure on risky assets in the pool (e.g. $BTC, $ETH, etc)
Trader's profit and loss (Refer to GMX.io traders PnL section)

How does the strategy work?

This strategy aims to achieve market-neutral position by hedging volatile assets in the GLP pool.

User deposits USDC into strategy vault
Strategy splits funds for buying GLP and for delta hedging on AAVE
Leverage up to 2.5x short on AAVE
Target delta-neutral positions comprised of: a. ~80% of deposits in GLP b. Non-stable token shorts matching GLP exposure on AAVE
Continuously monitor: a. Loan-to-value on AAVE to avoid liquidation b. GLP non-stable tokens weight change
Auto-rebalance on multiple triggers

Capture up to 80% of GLP APR without price exposure

This strategy vault achieves downside protection by trading off 20% upside yield. The vault significantly outperforms simply buy and hold GLP with lower draw-downs and higher return.

Fees

We charge a performance and management fee to cover the cost of managing positions and driving growth. Here's the fee scheme:

Fee Type

Ratio

Performance fee

15%

Management fee

Earn now

Go to https://www.undoxxed.co/
Deposit and Earn

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Last updated 2 years ago

Details

What is GMX/GLP?

Risks from holding GLP

Price exposure on risky assets in the pool (e.g. $BTC, $ETH, etc)

Trader's profit and loss (Refer to GMX.io traders PnL section)

How does the strategy work?

This strategy aims to achieve market-neutral position by hedging volatile assets in the GLP pool.

User deposits USDC into strategy vault

Strategy splits funds for buying GLP and for delta hedging on AAVE

Leverage up to 2.5x short on AAVE

Target delta-neutral positions comprised of: a. ~80% of deposits in GLP b. Non-stable token shorts matching GLP exposure on AAVE

Continuously monitor: a. Loan-to-value on AAVE to avoid liquidation b. GLP non-stable tokens weight change

Auto-rebalance on multiple triggers

Capture up to 80% of GLP APR without price exposure

This strategy vault achieves downside protection by trading off 20% upside yield. The vault significantly outperforms simply buy and hold GLP with lower draw-downs and higher return.