# 7.1x wstETH:ETH Auto-Compounder - Compound

{% hint style="success" %}
Visit Discover to deposit into this strategy and automate your yields!

:inbox\_tray:  [Strategy Deposit Link ](https://pro.factor.fi/strategies/0x1425f226BD821C44b8C187ec2A8B5CE4f1A29323)
{% endhint %}

{% hint style="info" %}
Visit Studio to copy/fork and tweak this strategy!

:tools:  [Strategy Builder Link](https://studio.factor.fi/?hash=0x68f3a7dd13de7c8c7ff30faaf359f72da1155852a16f8c323a06466a664694d6)
{% endhint %}

## Description

<figure><img src="https://1496012388-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FSEwRza4r80hmJsISwKFf%2Fuploads%2F9SfeToS7w4VL7aJj3EsP%2F7.1x%20wstETH_ETH%20Levered%20Yields-Full.jpg?alt=media&#x26;token=511d71a7-931b-4b55-bb4a-3c7a4f167243" alt=""><figcaption></figcaption></figure>

This vault creates 7.1x leveraged wstETH:ETH position that earns 1x wstETH liquid staking yields plus an additional 6.1x interest differential between wdtETH yields and WETH borrow costs.

Deposited wstETH is supplied to Compound enabling the strategy to borrow WETH which is then swapped for more wstETH. This process is repeated to get up to 7.1x leverage which provides a 2.5% liquidation buffer.

\+ wstETH liquid staking yields

\+ COMP borrow rewards

\- ETH borrow interest

## Strategy

<figure><img src="https://1496012388-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FSEwRza4r80hmJsISwKFf%2Fuploads%2FyKEGErlh27dCKCPNn5XG%2Fimage.png?alt=media&#x26;token=a3e1e380-d80c-4e96-bf8b-56058158564a" alt=""><figcaption><p><a href="https://studio.factor.fi/?hash=0x68f3a7dd13de7c8c7ff30faaf359f72da1155852a16f8c323a06466a664694d6">https://studio.factor.fi/?hash=0x68f3a7dd13de7c8c7ff30faaf359f72da1155852a16f8c323a06466a664694d6</a></p></figcaption></figure>

{% tabs %}
{% tab title="Main strategy" %}

1. Claim all COMP rewards
2. Swap COMP → wstETH
3. Flash loan 6.1x the $wstETH amount (deposits plus rewards)
4. Lend all $wstETH - Compound
5. Borrow $ETH to cover flash loan
6. Swap borrowed $ETH → $wstETH
   {% endtab %}

{% tab title="Exit Strategy" %}

1. Flash loan $ETH
2. Repay $ETH debt - Compound
3. Withdraw $wstETH collateral - Compound
4. Swap $wstETH → $ETH
   {% endtab %}
   {% endtabs %}

## Protocol Parameters

{% tabs %}
{% tab title="Compound" %}

* [0.41%](https://app.compound.finance/markets/weth-arb) COMP Borrow Rewards
* [\~2.3%](https://app.compound.finance/markets/weth-arb) WETH Borrow Interest
* [88%](https://app.compound.finance/markets/weth-arb) wstETH Max LTV
  {% endtab %}

{% tab title="Lido" %}

* [\~2.6%](https://stake.lido.fi/) wstETH Liquid Staking Yield
  {% endtab %}

{% tab title="OpenOcean" %}

* 0.1% Max Slippage Config
  {% endtab %}
  {% endtabs %}

## Strategy Performance Conditions

<figure><img src="https://1496012388-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FSEwRza4r80hmJsISwKFf%2Fuploads%2FsuuLYhFr2b0VSflEfDU6%2F7.1x%20wstETH_ETH%20Levered%20Yields-Risk%20vs%20Returns.jpg?alt=media&#x26;token=a043da8f-7712-409a-8df9-ce9c4364fac5" alt=""><figcaption></figcaption></figure>

{% tabs %}
{% tab title="Profit" %}

* wstETH continuously increases in value vs WETH.
* WETH borrow cost is less than wstETH liquid staking yields plus COMP rewards
  {% endtab %}

{% tab title="Loss" %}

* wstETH depegs from ETH.
* wstETH liquid staking yields falls below WETH borrow costs.
  {% endtab %}
  {% endtabs %}

## Calculation Template

{% hint style="success" %}
**Create Your Own Strategies!**

Create a copy of the sheet below and tweak it to create your own personalized strategy.
{% endhint %}

{% embed url="<https://docs.google.com/spreadsheets/d/1EvGaQUkjT2ii665pMIWHKKMwL-6aepkKcezswitJEjU/edit?usp=sharing>" %}
<https://docs.google.com/spreadsheets/d/1EvGaQUkjT2ii665pMIWHKKMwL-6aepkKcezswitJEjU/edit?usp=sharing>
{% endembed %}

## Estimated Returns

{% embed url="<https://docs.google.com/spreadsheets/d/19zQ5sSqL81xaurh-m2iKc2DHLU5_gADJNmBKkijrb4k/edit?usp=sharing>" %}
<https://docs.google.com/spreadsheets/d/19zQ5sSqL81xaurh-m2iKc2DHLU5_gADJNmBKkijrb4k/edit?usp=sharing>
{% endembed %}