# Yield Vaults

Yield vaults convert passive onchain assets into passive yield compounding strategy shares. Vaults follow the ERC-4626 standard. Users deposit, receive vault receipt shares, earn compounded yields, and are able exit anytime via pools or during redemption windows.

{% hint style="info" %}
Note: Vaults are rolling. Each epoch has a deposit and redemption period to allow orderly rebalancing and strategic resets for each epoch.
{% endhint %}

***

### How Yield Vaults Work

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{% tab title="Flow summary" %}

* **Deposit window** - Users deposit supported tokens into a vault and receive an ERC-4626 receipt representing their share of the vault.<br>
* **Epoch start** - Assets are deployed onchain into yield strategies. Institutional partners quote and execute passive low-risk income strategies offchain at the best possible rates and executes them using their portfolio capital pool. <br>
* **Settlement**- Onchain farm yield and realized strategy returns are finalized and automatically compounded into the vaults `totalAssets()`. Shares accrue value over time.<br>
* **Redemption window** - Receipt tokens can be traded anytime mid-epoch or be redeemed against the accrued net asset value (NAV) during the scheduled redemption window which lasts 24h.

<div data-full-width="true" data-with-frame="true"><figure><img src="/files/KTenrTyeQkUnuN1R5Svl" alt=""><figcaption></figcaption></figure></div>
{% endtab %}
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***

## Fees

| Strategist | Performance | Execution Partner |
| ---------- | ----------- | ----------------- |
| RFY        | 10%         | DWF               |

{% hint style="info" %}
Performance fee is taken on realized profit at settlement.
{% endhint %}

**Example**

A vault starts an epoch with 100 ETH in deposits and earns 1 ETH profit over 30 days.\
The vault charges a 10% performance fee (on profit) at the end of the epoch.

**Formula:**\
`fee = gross_profit × performance_fee_rate`&#x20;

**Calculation:**\
`performance fee = 1 ETH × 0.10 = 0.1 ETH`&#x20;

* Gross profit = 1 ETH
* Performance fee = 0.1 ETH
* Net profit returned to the vault = 0.9 ETH

**Net effect for depositors:**\
The vault’s `totalAssets()` and receipt NAV increase based on the net profit after fees (≈ 0.9 ETH).

***

<table data-card-size="large" data-view="cards" data-full-width="false"><thead><tr><th>Type</th><th>Strategy<select multiple><option value="b0Y3e7sHD3zy" label="Active Strategy" color="blue"></option><option value="XWldPPQgqvxv" label="Passive Strategy" color="blue"></option><option value="5gpAIOMfjM8K" label="Covered Calls" color="blue"></option><option value="FzsABPDyWnPc" label="Onchain Farming" color="blue"></option><option value="2khEPwVYRVca" label="Fixed Income" color="blue"></option><option value="I7d80kwEnd0g" label="Compounded Premia" color="blue"></option><option value="zUEjnfPYi5kJ" label="Short Volatility" color="blue"></option><option value="yNiC0vRGCq1s" label="Principal Protected" color="blue"></option><option value="fcjmGAgCdzpj" label="Compounded" color="blue"></option><option value="fQk8DRZbOjxB" label="Yield" color="blue"></option><option value="lStyMt44bTK4" label="Cash Secured Puts" color="blue"></option></select></th><th data-type="content-ref">Link</th><th>Deposit Token</th><th data-hidden data-card-cover data-type="image">Cover image</th></tr></thead><tbody><tr><td><sub>BTC Call Vault</sub></td><td><span data-option="5gpAIOMfjM8K">Covered Calls, </span><span data-option="XWldPPQgqvxv">Passive Strategy, </span><span data-option="fcjmGAgCdzpj">Compounded, </span><span data-option="fQk8DRZbOjxB">Yield</span></td><td><a href="https://rfy.finance/vault/3637/0x5107b03d9b4fb135a58435a4507716304372645b">https://rfy.finance/vault/3637/0x5107b03d9b4fb135a58435a4507716304372645b</a></td><td><sub>stBTC</sub></td><td><a href="/files/CEETHUVOhHHV0Pa0hVRd">/files/CEETHUVOhHHV0Pa0hVRd</a></td></tr><tr><td><sub>ETH Call Vault</sub></td><td><span data-option="5gpAIOMfjM8K">Covered Calls, </span><span data-option="XWldPPQgqvxv">Passive Strategy, </span><span data-option="fcjmGAgCdzpj">Compounded, </span><span data-option="fQk8DRZbOjxB">Yield</span></td><td><a href="https://rfy.finance/">https://rfy.finance/</a></td><td><sub>ETH</sub></td><td><a href="/files/Tp3CxerzLyGm09Ekma8Q">/files/Tp3CxerzLyGm09Ekma8Q</a></td></tr><tr><td><sub>INJ Put Vault</sub></td><td><span data-option="2khEPwVYRVca">Fixed Income, </span><span data-option="FzsABPDyWnPc">Onchain Farming, </span><span data-option="lStyMt44bTK4">Cash Secured Puts</span></td><td><a href="https://www.rfy.finance/en/vaults/manage?chainId=1776&#x26;address=0x5cbe2cde999d80f9699000bebc07f1d04f2b1dc0&#x26;epoch=0">https://www.rfy.finance/en/vaults/manage?chainId=1776&#x26;address=0x5cbe2cde999d80f9699000bebc07f1d04f2b1dc0&#x26;epoch=0</a></td><td><sub>USDT</sub></td><td><a href="/files/U1RuWWdda9RmP3P5wuWT">/files/U1RuWWdda9RmP3P5wuWT</a></td></tr><tr><td><sub>INJ Call Vault</sub></td><td><span data-option="5gpAIOMfjM8K">Covered Calls, </span><span data-option="XWldPPQgqvxv">Passive Strategy, </span><span data-option="FzsABPDyWnPc">Onchain Farming</span></td><td><a href="https://www.rfy.finance/en/vaults/manage?chainId=1776&#x26;address=0x9a7f6c9168878aebc80ec6ac2a5596d3de593138&#x26;epoch=0">https://www.rfy.finance/en/vaults/manage?chainId=1776&#x26;address=0x9a7f6c9168878aebc80ec6ac2a5596d3de593138&#x26;epoch=0</a></td><td>wINJ</td><td><a href="/files/4ajLmhxlWGGUpw1fEpwW">/files/4ajLmhxlWGGUpw1fEpwW</a></td></tr></tbody></table>

***

### Risks and disclosures

Yield Vaults carry several material risks. Offchain execution and counterparty issues can affect settlement and NAV, smart contract bugs or exploits may lead to loss or interrupted redemptions, and mid-epoch liquidity can be limited causing high slippage or inability to exit. Market and collateral volatility can produce losses even for delta neutral strategies. Receipts are ERC-4626 and composable; using them in other protocols introduces additional risks. There is no guarantee of positive returns, and any insurance reserve is a backstop but not a guarantee of full recovery. This content is informational and not financial, legal, or tax advice.


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