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Vault Economics

Economic primitives

Base Asset: base accounting token of the vault (asset()).
Asset: one of the vault's supported assets (including the base asset).
Shares: vault ownership units (ERC-20 shares of the vault itself).
Share value: assets per 1 share, sourced through oracle valuation.

Share pricing model

UltraVault.totalAssets() is computed as an oracle quote of total shares into base asset units.
Share pricing data is published on-chain to the configured oracle address after off-chain calculations.
The vault follows the standard ERC-4626-style approach for conversion between shares and assets:
- convertToAssets(shares)
- convertToShares(assets)

Fee model

The vault supports three fee types:

Performance fee
- Charged only when share value is above a high-water mark.
- Accrues continuously as share value rises above high-water mark.
- Charged in shares.
- Max allowed configured rate: 30%.
Management fee
- Time-based annualized fee accrued linearly with elapsed time.
- Charged in shares.
- Max allowed rate: 5%.
Withdrawal fee
- Applied during redeem fulfillment in output asset units.
- Charged in the asset being withdrawn.
- Max allowed rate: 1%.

Fee collection mechanics

Fees are crystallized by _collectFees() and minted as shares to feeRecipient.

Fee collection occurs on:

operations that modify the vault's total supply:
- deposit
- mint
- redeem fulfillment
fee updates
manual collectFees() calls

Performance fee intuition

Track highwaterMark in share-value terms.
If current share value is below or equal to high-water mark, no performance fee accrues.
If above, fee accrues continuously on the gain portion.
On collection, high-water mark updates to current share value when higher.

Management fee intuition

Management fee accrues with time:

proportional to totalAssets
proportional to elapsed seconds since lastUpdateTimestamp
normalized by one year

In plain terms: more TVL and more elapsed time means more management fee accrual.