Pseudo-Delta Neutral Hedging Experiment 4: Deploying PDN Techniques to Grow My Token Stash Revisited

I had mentioned in an earlier article, Pseudo-Delta Neutral (PDN) Hedging Experiment 3, that I had introduced some elements of PDN into a strategy to grow my token stash. The result was encouraging, as I managed to outperform the yield that would I have received from just lending them out by quite a bit.

Since then, I had also tried other variations such as setting up typical PDN positions on non-traditional PDN token pairings that do not involve any stablecoins, such as ORCA-SOL. The idea behind this is that by choosing a pair of tokens with price movements that have some degree of co-relation, we can minimize the amount of Impermanent Loss (IL) in our position.

Disclaimer: This is not investment or financial advice, but a sharing of my adventures and learnings in crypto space, where I conduct various experiments with different tokens and protocols across different blockchains.

Objective

The purpose of this experiment is to find out if a position that is based on my Experiment 3 or a typical PDN position would work better to grow my SOL holdings for the 14-day duration of the experiment from Thursday 10th - Thursday 24th February 2022.

10 SOL were initially allocated to each of the following positions and the LYF protocol I had used for this was Tulip Protocol on Solana blockchain. I could have used Francium Protocol for this…