APY/APR Calculation
APY/APR Calculation
APR
APR represents Annual Percentage Rate charged for certain investment with no compounding.
APY
APY(Annual Percentage Yield) takes into account compounding, but APR does not. The more frequently the interest compounds, the greater the difference between APR and APY. Investment companies generally advertise the APY, while lenders tout APR.
For more detailed information, please refer to:
APY Calculation
Suppose the initial interest rate is APR, and you deposit M units of your assets for n hours (compounding periods).
A. The primary interest rate APYprimary if return as the same assets you deposited is:
※ For the derivation process please refer to: https://en.wikipedia.org/wiki/Annual_percentage_yield
B. Then 70% of primary interest is returned in the form of LP token of that respective pool, and 30% in TURK. This 30% worth of profit is calculated in $ equivalent of KLAY, and 5 TURK is given for every 1 KLAY.
Example
Assume that:
A. Initial interest rate is APR=63.94%
B. You deposit 1000 units of asset for a whole month (30 days)
C. At the moment of your withdrawal, the price of your asset is 1.2$, the price of LP token is 5$, the price of KLAY is 0.85$
Then the primary interest is:
Then the final interests are as below:
70% in LP token, the amount of the LP token is: 55.52×1.2×70%÷5≈ 9.32
30% in TURK, the amount of TURK is: 55.52×1.2×30%÷0.85×5≈117.57
Last modified 3mo ago
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