The following is the calculation of the yield and profit generated when an on-chain FD is redeemed upon maturity.
No fees have been included in the calculations
FD_At_Maturity: Amount which trader receives at Maturity
FD_Yield: FD Yield Rate when trader entered the Trade
pool_length: Days to Maturity
FD_Value_At_Entrance = FD_At_Maturity / (1+ FD_Yield)^(pool_length/365)
Profit at Maturity = FD_At_Maturity - FD_Value_At_Entrance
FD Yield on Early Redemption
The following is the calculation of the yield and profit generated when an on-chain FD is redeemed before maturity.
No fees have been included in the calculations
FD_At_Maturity: Amount which trader receives at Maturity
FD_Yield: FD Yield Rate when trader entered the Trade
pool_length: Days to Maturity
FD_Value_At_Entrance = FD_At_Maturity / (1+ FD_Yield)^(pool_length/365)
Early_Redemption_time: time in seconds
FD_At_Early_Redemption = Entrance_FD_Value * (1+ FD_Yield)^(Early_Redemption_time/365*60*60*24)
Early Redemption Profit = FD_At_Early_Redemption - FD_Value_At_Entrance
