Yield Strategies is a section where you'll find precise ways to set up strategies for earning yield through DeFi protocols. My focus is on risk management to avoid liquidation and to understand the full mechanics behind every strategy.
Next Strategy…. [ P0 rate arbitrage ]
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Both srNUSD and jrNUSD are available on Pendle as PT (Principal Token) and YT (Yield Token), which adds another strategic layer on top of Strata’s tranche structure.
On Pendle, PT locks in a fixed return until maturity, while YT gives you pure exposure to the yield.
This creates interesting opportunities:
What’s good here is you can take advantages of the safe feature of srNUSD and buy YT to leverage your yield OR you can get a fixed interest on jrNUSD so take advantages of it’s risky aspect but locking a fixed yield on it through PT :
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sNUSD's underlying yield (UY) is 12.8%, but its implied yield (IY) is 13.3%.
The <1% difference (IY - UY) reflects the market's valuation of its 25x points as equivalent to <1% yield from airdrops.
In other words, the extra <1% in IY over the base is the premium buyers are paying for the points multiplier, implying that's how much the points are "worth" in yield terms.
This implies mispricing vs. NUSD (50x points at ~9.5% IY), so one must be wrong.
My bet: sNUSD's IY will rise to correct it.
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