From ebfc229d1ae891750e260948ec354a6c634d309d Mon Sep 17 00:00:00 2001 From: "dr. mia von steinkirch, phd" <1130416+mvonsteinkirch@users.noreply.github.com> Date: Wed, 8 Feb 2023 15:33:46 -0800 Subject: [PATCH] Update glp_vaults.md --- MEV_by_chains/MEV_on_Arbitrum/gmx/glp_vaults.md | 2 ++ 1 file changed, 2 insertions(+) diff --git a/MEV_by_chains/MEV_on_Arbitrum/gmx/glp_vaults.md b/MEV_by_chains/MEV_on_Arbitrum/gmx/glp_vaults.md index e355c64..ca200dd 100644 --- a/MEV_by_chains/MEV_on_Arbitrum/gmx/glp_vaults.md +++ b/MEV_by_chains/MEV_on_Arbitrum/gmx/glp_vaults.md @@ -20,6 +20,8 @@ * the first component of a pool are the available assets, which are the vault assets minus reserved assets (assets set aside to cover longs). * by covering longs, a reserved $BTC that would move with $BTC is used to cover a long position by surrendering all the upside gains to the counterparty (but also taking all collaterals of the counterparty when the price of $BTC goes down). * conversely, a short against the pool becomes a synthetic long as its credit gains to the pool when the price goes up (but takes money from the pool when the price goes down). +* hedging $GLP means taking short positions, either on GMX or on a CEX. The short pays when the directional asset goes down, and loses when the opposite happens. +* the spread of hedged $GLP over $ETH is a good measure of $GLP's performance, and why a hedged strategy might be a better holding strategy that minimises volatility.