Long Farming

What is Long Farming?

Long farming is a strategy that lets you profit when the value of an asset increases. In this example, you borrow USDC to buy SOL and provide both as liquidity in a Liquidity Farming. If SOL’s price rises, it will sell at higher prices within the range you set, generating profits. Additionally, you earn trading fees while your position stays within the range.

Think of it as a limit order that also earns fees while waiting for the price to move.

Long Exposure: Fully Adjustable on DeFiTuna

DeFiTuna gives you complete control over your exposure. By adjusting parameters like deposit ratio, price range, borrow ratio, and leverage, you can customize your position to match your goals—whether you want higher potential profits with more risk or a more balanced, safer position.

Key Parameters to Manage Long Exposure

1. Deposit Ratio

   • This is how much of your position consists of SOL.

   • Higher deposit ratios increase your exposure to SOL.

   • For instance, creating an out-of-range position with a 100% deposit ratio of SOL allows you to maximize your exposure.

2. Range

   • The price range determines where your SOL will be sold.

   • Setting a higher maximum price means your SOL will sell for more, but it may take longer to reach that price.

   • A wider range can also reduce fee-earning efficiency. Think of it like a balancing betweed fees generation and

3. Borrow Ratio

   • Borrowing more USDC increases your exposure to SOL.

   • If you allocate 100% of the borrowed USDC to purchasing SOL, you maximize your position’s growth potential.

4. Leverage

   • Leverage allows you to increase the size of your position by borrowing additional funds.

   • Higher leverage can amplify your profits if the price moves in your favor but also increases your risk.

   • Tip: To reduce the risk of liquidation, you can borrow more USDC or adjust your deposit ratio and price range for a safer setup.

Advanced Tip: Boost Profits Through Compounding

To maximize returns, consider reinvesting the fees earned from your SOL/USDC position as collateral to open additional leveraged positions. This creates a compounding effect, where your profits grow at an accelerating rate. By reinvesting earnings, you can exponentially enhance your overall profitability.

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Final Reminder:

Long farming is a powerful way to grow your portfolio during Bull Market, but it requires careful planning and risk management. Use DeFiTuna’s flexible tools to adjust your position, align it with your goals, and ensure sustainable growth.