Rebalancing & Strategy Execution
Last updated
Last updated
Each Node maintains a target reserve ratio of its underlying asset. For example, a Node might target 10% of USDC in reserve. Any excess above this target becomes available for investment in the Node's components.
To prevent excessive execution costs, investment transactions can only occur during specific rebalance windows. The Node owner sets both:
Cooldown period between rebalances (e.g., 23 hours)
Duration of rebalance window (e.g., 1 hour)
This means even if excess reserve is available, the rebalancer must wait for the cooldown to expire before starting a new rebalance window.
Each component in the Node has two key parameters:
Target Weight: Desired allocation (e.g., 40% of assets)
Maximum Delta: Allowed deviation (e.g., 5%)
Current allocation is sufficiently below target (beyond maxDelta)
Node has excess reserve above its target
Within an active rebalance window
This ensures disciplined execution of the Node's strategy while minimizing unnecessary transactions.