Portfolio Bucketing & Final Notes
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⚠️ Non-Financial Advice This section provides a framework for thinking about risk allocation. It is not a recommendation or allocation plan.
For larger holders or entities, it can be helpful to think in terms of risk buckets.
Focus on non‑leveraged positions from the Conservative page:
psXDC “set‑and‑forget” yield stack.
USDC “parking lot.”
50/50 psXDC + USDC base.
Characteristics:
No liquidation risk (no borrowing).
Yields mainly from staking, borrow interest, and protocol incentives.
Main risks: protocol/contract risk and underlying asset volatility.
Borrowing strategies with no recursive looping:
psXDC collateral → borrow USDC (stay long XDC).
USDC collateral → borrow XDC → stake to psXDC.
psXDC collateral → borrow XDC for operations.
Characteristics:
Liquidation risk exists but is manageable if Health Factor is kept high (e.g. ≥ 2.0).
Yields come from spreads between psXDC yield and borrow APRs, plus incentives.
Requires periodic monitoring and risk management.
Only for small, high‑risk capital allocations:
psXDC → borrow XDC → stake → psXDC loop when math is clearly favorable.
USDC + psXDC barbell loops and other complex structures.
Possibly automated liquidation strategies.
Characteristics:
High tail risk and sensitivity to market conditions.
Suitable only for advanced users who can monitor positions and systems closely.
Should be sized such that a complete loss would not threaten overall solvency.
All strategies described across these pages are examples, not recommendations.
Before implementing any position:
Check live APRs, utilization, and risk parameters in the PrimeFi UI.
Stress test your assumptions (e.g., sudden XDC drawdown, APR changes, de‑peg scenarios).
Decide in advance:
How much you are willing to lose in worst‑case scenarios.
What Health Factor you consider your “panic line” for reducing risk.
🧠 Always do your own research. DeFi can be powerful, but it is never risk‑free.
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