Single Finance

Pseudo Market-Neutral Strategy

What are the purpose of Pseudo Market-Neutral Strategy?

  1. 1.
    Increase return through adding leverage of your liquidity mining position
  2. 2.
    Achieve delta neutral of the assets in the beginning of the position

What are the benefits of Pseudo Market-Neutral Strategy?

  1. 1.
    Achieve the highest return
  2. 2.
    Minimize impermanent loss by managing the payoff curve

How does Pseudo Market-Neutral Strategy work?

When using the Pseudo Market-Neutral Strategy, you can only use it with the liquidity pair, which is made up of one borrowable stablecoin and another borrowable asset. Your strategy vault would borrow an amount equal to the quantity of non-stablecoin assets in the liquidity pool. Therefore, our strategy will begin with a delta-neutral position.
Our bot will keep track of the price movement of the non-stablecoin asset and will automatically rebalance the position to get it back to delta-neutral. It is possible to limit your temporary loss while increasing your overall return by borrowing assets to improve your leverage ratio.
Here is the real example of farming 10,000 BUSD in PancakeSwap.