$772 passive IL to $372 active IL
Backtested Methodology
Impermanent loss reduction, measured against passive LPs.
Yield Delta actively re-centers liquidity ranges before stale positions compound losses. In the 90-day model, active management reduced IL by 52% while turning a passive loss into positive net return.
2.14% over 90 days after costs
Positive after IL, fees, and gas
13 rebalances across 90 days
Proof
Passive LP vs Yield Delta
The key result is not just lower IL. The strategy preserved enough fee capture to move the vault from negative net return to positive net return after modeled gas costs.
| Metric | Passive LP | Yield Delta | Change |
|---|---|---|---|
| Initial capital | $10,000 | $10,000 | - |
| Fees earned | $538 | $589 | +9.5% |
| Impermanent loss | -$772 | -$372 | 52% lower |
| Gas cost | $0 | -$3.25 | SEI cost advantage |
| Final net | -$234 | +$215 | +$449 |
| APY | -9.4% | 8.91% | +18.3 pts |
Method
How the strategy changes the loss curve
Tighter Active Ranges
Yield Delta concentrates liquidity in narrower ranges, increasing fee density while monitoring when that range stops being efficient.
IL-Aware Rebalancing
The strategy resets position exposure when price exits range or modeled IL crosses the risk threshold.
Low-Cost Execution
Frequent rebalancing only works when transaction costs are small. SEI-style execution makes the cadence economically plausible.
Model Foundation
Position resets are the core mechanic.
A passive LP carries IL from the original entry price. Yield Delta closes and reopens ranges around updated market prices, converting large accumulated IL into smaller, bounded losses while keeping capital in fee-producing bands.
IL = 2 * sqrt(price_ratio) / (1 + price_ratio) - 1rebalance when range_exit || modeled_IL > thresholdAssumptions
- Test period
- 90 days
- Initial capital
- $10,000
- Trading fee tier
- 0.30%
- Gas cost
- $0.25 / tx
- Rebalance trigger
- Range exit or 2% IL
- Total rebalances
- 13
What this proves
The model shows that active liquidity management can reduce IL enough to change the return profile of LP positions, especially on chains where execution costs do not overwhelm rebalancing.
What it does not prove
Backtests are not guarantees. Performance can degrade under liquidity shocks, extreme volatility, oracle issues, or if live execution costs exceed assumptions.
Use the clean proof visual in the pitch deck.
The detailed page explains the method. The `/backtest` route is the screenshot-friendly version for investors.