# Multi-Asset Deposit Ratio Calculation

Last updated

Last updated

Deposits into multi-asset Smart Vaults need to be made in appropriate ratios between all deposited assets.

The ratio depends on the Vault its set allocation between different Strategies, and the ratio required by each of the Strategies. Plus, when flushing deposits into Strategies, deposited funds need to be divided back accordingly.

*Feel free to refer to the accompanying spreadsheet with interactive calculations that follow the below procedures.*

**Calculation of ideal deposit ratio. **

First let us have a look into how to calculate the ideal deposit ratio, based on the Vault its set allocation between the Strategies, the asset ratios demanded by the Strategies, and the exchange rate between assets (or rather between assets and USD).

**Example vault**

Let us say we have a vault with three Strategies, Aave, Idle and Yearn, with the following allocation set between them:

Strategy | % Allocation |
---|---|

The above allocation means that 60% of the deposit its value should be deposited in the Aave strategy.

The vault is a "Multi-Asset Smart Vault" with deposits made in ETH, BTC, and BNB, with the following exchange rate:

Asset | USD Rate |
---|---|

*Where 1 ETH costs $1206.16.*

Each Strategy also has a required ratio between the assets for depositing into it:

Aave | Idle | Yearn | |
---|---|---|---|

In the case of Aave, the deposit needs 0.071 BTC and 4.3 of BNB tokens for each ETH token deposited.

Derivation A user wants to make a deposit, valued at $1,000,000. The question is now how much ETH, BTC, and BNB they need to deposit.

First, let's split this amount between the strategies based on the vault’s allocation:

Then we can express the ratios between assets required by the strategies in $ by multiplying them with the exchange rates:

From this we can calculate the normalization factor per strategy by summing values for all assets:

Now we can split the USD amount allocated for each strategy among the assets by multiplying it with the USD ratio and dividing by the normalization:

This means that of the $600,000 of the deposit allocated to the Aave, $205,029.38 worth should be deposited in ETH. To get the number of tokens for each asset, we divide the $ values by the corresponding exchange rate:

From this we can get the full deposit amount by summing over the strategies:

So the deposit of $1,000,000 should consist of 279.18 ETH, 20.20 BTC, and 1225.09 BNB.

Aave | Idle | Yearn | |
---|---|---|---|

Aave | Idle | Yearn | |
---|---|---|---|

Aave | Idle | Yearn | |
---|---|---|---|

Aave | Idle | Yearn | |
---|---|---|---|

Aave | Idle | Yearn | |
---|---|---|---|

ETH | BTC | BNB | |
---|---|---|---|

Aave

60

Idle

30

Yearn

10

ETH

1208.16

BTC

16404.71

BNB

270.39

ETH

1

1

1

BTC

0.071

0.074

0.076

BNB

4.3

4.5

4.6

Deposit Share

600,000

300,000

100,000

ETH $

1208.6

1208.16

1208.16

BTC $

1164.73

1213.95

1246.76

BNB $

1162.68

1216.76

1243.79

Normalisation

3535.57

3638.86

3698.71

ETH $

205,029.38

99,604.72

32,664.34

BTC $

197,659.89

100,081.95

33,707.90

BNB $

197,310.74

100,313.32

33,627.76

ETH

169.70

82.44

27.04

BTC

12.05

6.10

2.05

BNB

729.73

370.99

124.37

Tokens

279.18

20.20

1225.09