What is the difference between Teahouse's LP Vaults and Managed Vaults?
Teahouse LP Vaults (also called Permissionless Vaults) are dual-asset token pairs used to provide liquidity. Users deposit two types of tokens into select strategies to be managed by Teahouse or a Teahouse strategy partner and can enter and exit at any point in time.
Teahouse Managed Vaults are similar to traditional funds. Users deposit their single-type assets into select strategies to be managed by Teahouse or a Teahouse strategy partner, and enter/exit the vaults every Round (read more about our Round cycles here).
Simply put, from the users' point of view, LP/Portfolio Vaults are more convenient, as one can enter & exit at any time,, whereas for Managed Vaults, users will need to wait for the next round for their deposit/withdrawal request to be processed by the Fund Manager.
How do I pick a strategy?
Teahouse recommends users select strategies based on their understanding of the current market and their own risk tolerance. Some types of strategy tend to perform better than others in certain market conditions. In addition, our Managed Vaults are labeled with their respective back-tested "maximum drawdown" values to indicate their risk level.
Users should generally look at each underlying strategy concept, mechanism, and historical data rather than the vault type, then pick the one(s) most suitable to individual needs.
It may also be beneficial to diversify into more than one strategy.
$OPTEA, $OPTEA+, $TeaETH, and $Oolong Tokens are “ShareTokens” issued by Teahouse, each corresponding to a Teahouse strategy, that act as an accounting mechanism to denote the number of shares of the total fund a user owns. ShareTokens are issued to the fund investors based on the amount of assets (e.g. $USDC or $ETH) they deposit to the fund. The nominal value of a ShareToken changes with the fund. When exiting the fund, users will redeem their $ShareToken back into their original asset(s).