I’m using the impermanent loss calculator to calculate the IL I’d have if a coins goes x%.
What I have found is that if we take an example of Token A and stable coin.
If tokens A does a 5x (500%), the IL would be roughly 25%, however what kept me thinking was if I had kept 100% of Token A would I have ‘lost’ more money?
Case: Token A: stable coin (start 1$ both)
Impermanent loss: 25.46%
If $500 of Token A and $500 of Token B were held
– Have 500.00 Token A and 500.00 Token B
– Value if held: $3,000.00
If $500 of Token A and $500 of Token B were provided as liquidity
– Have 1,118.03 Token A and 223.61 Token B (in liquidity pool)
– Value if providing liquidity: $2,236.07
So if I didn’t swap 50% of Token A to a stable coin, I would have 1000 Tokens of A and therefore should have had 5000$ right? If you take this example the ‘loss’ would be (1- (2236/5000) * 100%) ~ 55%