APY for INF

Yield Yields will vary depending on the number of LSTs, trading volume of those LSTs, TVL in the pool, TVL in other LPs, etc. A base staking return (a weighted average of the LSTs in the pool) of ~7.5% plus variable returns from trading fees on top of that should be expected. Performance Drift Some LSTs have better staking returns than others and will drift in value over time. If Infinity is overweighted with poor-performing LSTs, this will affect the APY of INF holders.

The yield accrued in INF is a combination of staking yields from the LST basket plus trading fees. A poorly-performing LST (in APY terms) could be a strong contributor to INF’s total returns if it sees strong trading volume. So it’s not the case that INF should only hold high-APY LSTs. Nonetheless, the pool manager can adjust fees (or manually rebalance) to reduce the pool’s holdings of poor-performing LSTs.

In the Rebalancing section, an assumption was made that the pool manager wanted to maintain a 50-50 bSOL-scnSOL ratio. But that is of course arbitrary. The pool manager should target an allocation that maximises yields for INF holders (while maintaining a minimum amount for each LST), but what that allocation looks like exactly is impossible to answer at this time.