Investment Unit, LP Token and uLP Token Value

The ADA value of a token is it's average buy/sell ADA price of all the different exchanges offering that exchange. The ADA value of each token will be calculated and provided by the Oracle Contract.

We will only use the term value of a token, Investment Unit, LP token, or Fund, but we will be referring to its ADA value.

From the value of each token forming the Investment Unit, its value can be calculated.

For example, in the following Investment Unit:

• 100 of Token A

• 4 of Token B

• 1 of Token C

Its value would be calculated as follows:

The value of the tokens:

• Token A = 1 Lovelace

• Token B = 5 Lovelace

• Token C = 20 Lovelace

The value of the Investment Unit:

• Token A = 1 * 100 = 100 Lovelace

• Token B = 5 * 4 = 20 Lovelace

• Token C = 20 * 1 = 20 Lovelace

The sum of the values of the tokens that make up the Investment Unit gives us its value, in this case:

• UI value = 100 + 20 + 20 = 140 Lovelace

In turn, the uLP token has a 1:1 parity with the Investment Unit; therefore the Lovelace value of the uLP token in this example Fund would be:

• Value of the uLP token = Value of the UI = 140 Lovelace

Finally, recall that 1 LP = 1,000,000 uLP, so in LP value:

• Value of LP token = Value of uLP token * 1,000,000 = 140 Lovelace / 1,000,000 = 140,000,000 Lovelace = 140 ADA

We will see that it is always true that the value of the uLP in Lovelace is the same as the value of the LP in ADA.