Oxford-Man Institute: Predictable Loss and Optimal Liquidity Provision

How can automated market makers find an optimal liquidity provision strategy? Fayçal Drissi, Visiting PhD Student at the Oxford-Man Institute of Quantitative Finance, shares his research findings.

 

Decentralised Finance and Automated Market Making: Predictable Loss and Optimal Liquidity Provision

Álvaro Cartea, Fayçal Drissi, Marcello Monga

This paper introduces a new comprehensive metric of predictable loss for liquidity providers in constant function automated market makers to derive an optimal liquidity provision strategy.

 

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