Feeder Finance
  • Feeder Finance Overview
    • πŸ‘‰What is Feeder Finance?
      • FEED Tokenomics
      • Why should I buy FEED?
      • How to Buy FEED
    • ⚜️sFEED Ecosystem
    • πŸ’΅Fees
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    • πŸ‘«Peer-to-Peer Lending
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    • πŸ“ŠYield Optimizer
      • 🌱AutoStaking
        • Auto Diversify
        • Auto-Compounding
      • 🌾AutoFarming
    • βš’οΈDeFi Tools
      • πŸ•ΈοΈDEX Aggregator
      • πŸ’±AutoConverter
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    • πŸ’™FEED Products
      • πŸ’ΈFEED Staking
        • How to Stake FEED
      • 🚜FEED Farming
        • β›²How to Provide Liquidity
        • πŸ§‘β€πŸŒΎHow to Farm FEED
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    • πŸ’»Contracts
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      • 🌳Stablecoins
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      • πŸ₯©Staking vs Farming
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      • 🟠How to Bridge ADA to BSC
      • πŸ”΅How to Bridge from BSC to FTM
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  • Overview
  • Auto Diversify Strategy Details
  • Diversification Benefits and Risks

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  1. Products & Services
  2. Yield Optimizer
  3. AutoStaking

Auto Diversify

"Auto Diversify" helps an investor automatically earn low-risk and high-return yields.

How does it work? We have developed powerful formulas that efficiently invest across multiple DeFi platforms, auto-compound, and rebalance regularly. All an investor needs to do is pick a token and deposit.

Overview

Structures

Single Asset

Single Asset

(No Belt)

Stablecoin

Deposit

BNB, BTC, ETH

CAKE

USDT, BUSD, DAI, USDC

Target Vaults

Target Strategy

Borrowing & Lending

Auto-compound

Staking

Auto-compound

Liquidity Providing & Farming

Auto-compound

Auto Diversify Strategy Details

Auto Diversify spreads deposits across multiple vaults, and directly into PancakeSwap and Dopple Finance as core platforms.

How it works:

  • Set base allocation of each target vault relative to its TVL and total TVL

  • Equally redistribute excess allocation above 50% in a single vault to the remaining targets

    • This makes sure we never allocate more than 50% to any vault

  • Take 20%* allocation from poor performers and distribute it to better performers; benchmark by APY relative to median

  • Rebalance if the current allocation is 5% more or less than the target allocation

*Auto Diversify options with 2 targets are will just be a 50/50 split until more targets are added.

How to deposit capital flows from Auto Diversify into the DeFi ecosystem:

Diversification Benefits and Risks

While deposits are diversified, it does not eliminate risks completely. This is because no investment, whether in DeFi or the physical world, is truly risk-free.

However, it should be noted that while the product diversifies across multiple target products, it does not necessarily diversify across wide-ranging platforms at the launch stage. Due to the limited availability of target products and development time, various deposit options are platform concentrated -- for instance, the stablecoin structure. Most single asset vaults end up with capital deposited within a few core products, such as Venus, Belt, and PancakeSwap; therefore, this is the nature of the ecosystem at this stage. Exploits typically happen at the smart contract level. Therefore, diversification at the target vault or core product level is a big step toward to reducing risks.

As the ecosystem develops, Auto Diversify's degree of diversification will improve with the addition of new target vaults.

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Last updated 3 years ago

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Users of Auto Diversify benefit from mitigation of risks by spreading investments into multiple targets (ie.: target vaults and target cores). A single exploit has the possibility of happening to any single target, but unlikely to happen to all at once. Yields generated on DeFi, as is hypothesized by the , has priced in a certain level of price volatility, exploit possibility, and all other factors that drive risk and return structures - not perfectly but generally. That is why yields are as high as they are, relative to other asset classes; think your stock portfolio. Investors face a tremendous risk of complete loss of capital when investments are located in a single location. Spreading investments out across multiple locations, in other words, target vaults or target cores, mitigate this risk.

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Efficient Market Hypothesis
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