# PAYE Graph

Last updated

Last updated

To incentivize borrowers to use liquidity from our ecosystem to generate as high yield as possible, Stella utilizes a model where the higher the annualized yield, the lower amount to be shared to lenders, and only yields from the leveraged portion are used to calculate the cut.

$\text{cut} = 0.25 + \frac{0.75}{\left(1+\frac{\text{Yield}_{\text{APR}}}{0.25}\right)^2}$

Below is a graph illustrating the range of share cuts (Y-axis), which can vary from 25% to 100%, based on the yields generated by leveragoors (X-axis). To navigate through the graph, click here.

Annualized Yield (%) | % Shared | To Leveragoors (%) | To Lenders (%) |
---|---|---|---|

0

100

0

0

10

63.27

3.67

6.33

20

48.15

10.37

9.63

50

33.33

33.33

16.67

100

28.00

72.00

28.00

150

26.53

110.20

39.80