Rebalancer

The rebalancer meant to keep a farmer delta-neutral through an automated mechanism. This feature is still in BETA.

To allow farmers to remain delta-neutral, the protocol allows users to set rebalancer parameters on when they'd like their position to be rebalanced. Users can choose to manually rebalance their position at anytime, but when the position falls under scope of rebalancing based on the user's parameters, it is allowed to be rebalanced by anyone. Delta One currently runs a bot on a random interval ranging from every 5 minutes to 2 hours.

Users should not rely on their position to be rebalanced perfectly, as prices may fluctuate faster than the rebalancer is called. A user can manually check to see if their position can be rebalanced by clicking the button "Check if rebalance is possible." If rebalancing is toggled, the button will turn into "Rebalance your position," in which the user can choose to also manually rebalance by going through the divest + re-invest steps. During a rebalance, users funds are withdrawn into a temporary token account; sometimes, the vault may not let the user re-invest due to the vault's capacity being at limit, or the user's rebalance parameters not remaining true. A user can withdraw their temporary token account funds back to their wallet at anytime by toggling "Enable Rebalancer" and clicking the "Close Rebalancer" button. Lastly, users can disable their rebalancer at anytime to prevent any future rebalancing from occurring (however, if a current rebalance is in progress, a user cannot interrupt it).

The rebalancer is located on the Farm vault page, below the Deposit/Withdraw component.

The rebalancer currently supports two types of parameters: price change and time. For instance, a lower bound of 10% and upper bound of 50% means that if you added liquidity to the SOL-USDC pool when SOL was at $100, then your position will be rebalanced if SOL increases above $110 (10%) but not if SOL increases above $150 (50%). The upper bound is meant to serve as a safe guard that protects against not being automatically rebalanced during flash changes of the price.

Users may also set a time delay, such as 24 hours, meaning that the position can not be rebalanced more than once within a 24 hour time period.

When a rebalance occurs, your price invested becomes the current price of the pool at the time of rebalancing. Rebalancing entails realizing all impermanent loss based on the difference between the current price and your original price invested; however, many farmers prefer rebalancing because it prevents impermanent loss from being compounded.

Delta One does not endorse any specific rebalancing parameters. However, we are inclined to report that community members have run backtests to show a 10% lower bound and 15% upper bound have been fairly optimal rebalancing parameters (with a 24-120 hour time delay) for SOL and RAY farming vaults.