Concentrated liquidity impermanent loss calculator #3
Description
Given a user is willing to take position at price P with liquidity added in the range [Pa, Pb], plot how the value of LP position varies in this range. The plot also need to show the hodling value variation. Effectively allowing user to see how LP position is changing compared to Hodl.
The feature will allow users to select tokens to create a pair, we fetch the current prices of the selected tokens, allowing users to simulate using current prices without manually entering them.
In theory, Concentrated LP always returns loss compared to HODL if not for yield from fees and incentives. Allowing user to enter an assumed yield and a period of LPing, show how the return would vary on varying price changes.
The tool could be later extended with the following features:
- Allowing user to select tokens for LPing and fetch current yield for the pool from respective protocol. Allowing users to get an idea of returns for current yield.
- To show how the returns vary for a custom strategy that involves multiple protocols.