Charm_Old
  • Charm Overview
  • Alpha Vaults
    • Overview
    • How the strategy works
    • Track Record
  • ALPHA PRO
    • Overview
    • Background
    • The challenges
      • What are projects doing now
    • The Alpha Pro solution
      • Use cases
    • How it works
    • Conclusion
      • Next steps
    • User guides
      • Strategy parameters
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    • Charm Options (V1)
      • Key Features
        • Capital Efficiency
      • Use Cases
      • How trading works
      • How liquidity provision works
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          • Notes
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  1. ALPHA PRO

How it works

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Last updated 2 years ago

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Alpha Pro works by combining (Uniswap V3 style LP) and (Uniswap V2 style LP) into a single vault. Passive Rebalancing is used to concentrate liquidity, increase capital efficiency, and minimise IL; and Full-Range ensures the tokens will always be tradable.

Therefore, Alpha Pro can:

  • Achieve better capital efficiency than Uniswap V2

  • Guarantee projects’ tokens are tradable in all market conditions.

*default values will be provided for basic users so they don't need to set the values themselves.

Track record

When creating their own vault using Alpha Pro, liquidity managers will need to set values* for the , depending on the balance they wish to achieve between capital efficiency and worst-case liquidity. After setting the values, the vault will automatically choses new ranges on behalf of the liquidity manager. The parameters' values can be changed at any time.

shows a single set of values for the Strategy Parameters have correctly chosen over since May 2021, without the liquidity manager having to chose a range themselves.

Strategy Parameters
Alpha Vault’s track record
1000 ranges
Passive Rebalancing
Full-Range
 Fig 3 - Alpha Pro deposits liquidity into 3 range orders on Uniswap V3: a to guarantee tokens will be tradable, a to concentrate liquidity, and a to minimise IL. By changing the Strategy Parameters (ie B, L, % liquidity in Full-Range, and rebalancing frequency), liquidity managers can choose how tradable they want their tokens to be, how much liquidity to concentrate, and how much IL protection to offer. After choosing the parameters, the vault will chose ranges on behalf of the liquidity manager, as .
Fig 4 - Alpha Vault is an example of a vault that can be build using Alpha Pro. shows that over 14+ months, Alpha Pro kept the market price (red line) within the middle of the ranges (blue region) chosen by the vault.
On-chain data
Full-Range order
Base-Order
Limit-Order
demonstrated by on-chain track records over 16+ months of continuous operation