Target Ratio and Fees

In the ALP pool, every token has a specific target ratio or weightage.

The transactions involving the addition or removal of liquidity have the primary purpose of adjusting a token's ratio in the pool to align it more closely with the predefined target.

Instructions that move the token's ratio away from the target incurs additional fees while instructions that move it closer to the target get a fee discount.

Fee Calculations​

Action	Fee
Opening a Position	10 BPS
Closing a Position	10 BPS
Swap Fee	Between 0 BPS to 200 BPS depending on pool weightage
Borrow Rate	1 BPS/hour x token utilization percentage

Fee calculation for opening and closing positions involves the volume of these transactions, multiplied by the fee percentage of 0.1%.

The borrow fee, often termed as the hourly borrow fee, is computed as follows:

hourly borrow fee = (tokens borrowed / tokens in the pool) x 0.01% x position size

Trade fees for the pool typically range between 0% and 2%.