7x rETH:ETH Levered Yields - Compound

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Description

This vault creates 7x leveraged rETH:ETH position that earns 1x rETH liquid staking yields plus an additional 6x interest differential between rETH yields and WETH borrow costs.

Deposited rETH is supplied to Compound enabling the strategy to borrow WETH which is then swapped for more rETH. This process is repeated to get up to 7x leverage which provides a 5% liquidation buffer.

+ rETH liquid staking yields

+ COMP borrow rewards

- ETH borrow interest

Strategy

https://studio.factor.fi/?hash=0xb554842f53a095d023e685fb7d24b1b682a65b7c8b91fccc1b14b851657ebde0

Main strategy

1. Flash loan 6x the deposited $rETH amount

2. Lend all $rETH - Compound

3. Borrow $ETH to cover flash loan

4. Swap borrowed $ETH → $rETH

Exit Strategy

1. Flash loan $ETH

2. Repay $ETH debt - Compound

3. Withdraw $rETH collateral - Compound

4. Swap $rETH → $ETH

Protocol Parameters

Compound

• 0.64% COMP Borrow Rewards

• ~2.1% WETH Borrow Interest

• 90% rETH Max LTV

Rocket Pool

• ~2.64% rETH Liquid Staking Yields

OpenOcean

• 0.1% Max Slippage Config

Strategy Performance Conditions

Profit

• rETH continuously increases in value vs WETH.

• WETH borrow cost is less than rETH liquid staking yields plus COMP rewards

Loss

• rETH depegs from ETH.

• rETH liquid staking yields falls below WETH borrow costs.

Calculation Template

Create Your Own Strategies!

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

https://docs.google.com/spreadsheets/d/1U9BOVhKlBRGiFNLfUZ-iSgZ--4X6zcQtGrwyL0VBmfQ/edit?usp=sharing

Estimated Returns

https://docs.google.com/spreadsheets/d/13qmV6QWLkjo2T-f2s4P_HHsQuw4LU-XeY-0Qz7lHJ5U/edit?usp=sharing