Impermanent loss (50/50 pool): Comparing a 50/50 Pool with Simply Holding
Impermanent loss compares the modeled value of a balanced constant-product pool with holding the original assets after a relative price change.
Use the Impermanent loss (50/50 pool) Calculator to enter your own figures and compare the result with the worked example below.
Impermanent loss (50/50 pool) formula
IL = 2√r ÷ (1+r) − 1
Worked example
| Item | Example value |
|---|---|
| Relative price ratio | 2 ratio |
| Impermanent loss (50/50 pool) | -5.719096% |
These are illustrative inputs, not current prices, rates or recommended targets. Where a currency is shown, keep all comparable money amounts in the same currency; conversion examples identify the two sides separately.
How to interpret the result
The formula excludes trading fees and rewards and assumes a basic 50/50 pool. Concentrated-liquidity positions need a different model.
Related calculations
Method and further reading
The example follows the FinMathly calculator method. For broader background, see Investor.gov: Leveraged investing risks. The background resource may use jurisdiction-specific terms; it does not replace the assumptions of this calculator.
Featured photograph: Pexels.