Impermanent loss is the gap between simply holding two tokens and depositing them into a liquidity pool. It appears whenever the two prices move apart, and it stops being “impermanent” the moment you withdraw. This calculator shows how large that gap gets for any price change, and the fee yield you would need to earn to cancel it out.
Impermanent Loss Calculator
See exactly how much you lose compared to simply holding — before you add liquidity to any DeFi pool.
| Token A Change | Token A Price | HODL Value | Pool Value | Impermanent Loss |
|---|
Token B held at entry price. Highlighted row = your current scenario (nearest match). Investment = your entered amount.
How to read the result
Enter what you put in, the entry price of each token, and where the prices ended up. The calculator returns two numbers that matter.
The first is the impermanent loss percentage — how much less your pool position is worth than the same tokens held in a wallet. The second is the breakeven APY: the annualised trading-fee yield the pool must pay you, over the time you were in it, just to get back to level. That second number is the one that decides whether a pool was worth entering, and almost no calculator shows it.
Impermanent loss at a glance
Impermanent loss depends only on the ratio between the two price changes, not the direction. A token that doubles and a token that halves produce exactly the same loss. That surprises people, and it is why hedging one side does not help.
| Price ratio change | Impermanent loss |
|---|---|
| 1.25× | 0.62% |
| 1.5× | 2.02% |
| 2× | 5.72% |
| 3× | 13.40% |
| 4× | 20.00% |
| 5× | 25.46% |
| 10× | 42.50% |
These figures are for a standard 50/50 constant-product pool, the Uniswap v2 model that most pools still use.
A worked example
Put $10,000 into a 50/50 ETH/USDC pool — $5,000 of ETH, $5,000 of USDC. ETH then doubles.
Had you simply held, you would have $10,000 of ETH plus $5,000 of USDC, so $15,000. The pool position is worth about $14,142. The difference, roughly $858, is your impermanent loss. The pool rebalanced you out of ETH on the way up, selling the asset that was appreciating.
Whether that $858 was a mistake depends entirely on the trading fees the pool paid you over the same period. If it earned more than $858, you came out ahead. That is what the breakeven APY output is for.
When impermanent loss actually matters
It scales with how far apart the two assets move, so the pair you choose matters more than anything else.
Stablecoin pairs such as USDC/USDT barely diverge, so impermanent loss is close to zero — which is also why their fee yields are low. Correlated pairs such as ETH/stETH move together and carry modest loss. Volatile pairs, and especially a new token against a stablecoin, are where positions get destroyed: a token that runs 10× hands you a 42.5% loss against having simply held it.
The uncomfortable implication is that impermanent loss is worst precisely when you were most right about the token.
What this calculator does not model
It models the constant-product formula, so it does not cover concentrated liquidity (Uniswap v3 and its forks). Concentrating your range amplifies both fee income and impermanent loss, and once price leaves your range you hold only one asset and stop earning entirely. Treat this as a floor for a v3 position, not an estimate of one.
It also excludes gas costs to enter, exit and rebalance, any token emissions or liquidity-mining rewards paid on top of trading fees, price impact when you deposit or withdraw, and tax. In most jurisdictions entering and exiting a pool are themselves taxable events, which is a question for an accountant rather than a calculator. Nothing here is investment advice.
Frequently asked questions
What is impermanent loss in simple terms?
Impermanent loss is the difference between the value of tokens held in a liquidity pool and the value of the same tokens held in a wallet. It happens because an automated market maker rebalances your position as prices move, selling the asset that is rising and buying the one that is falling. It is called impermanent because it reverses if prices return to their starting ratio, and it becomes permanent as soon as you withdraw.
How is impermanent loss calculated?
For a standard 50/50 constant-product pool, impermanent loss equals 2 times the square root of the price ratio, divided by one plus the price ratio, minus one. If one token doubles relative to the other, the ratio is 2 and the loss is 5.72%. The formula depends only on the ratio between the two price changes, not on which token moved or in which direction.
At what price change does impermanent loss become serious?
It stays under 1% for moves up to about 1.25 times and under 3% up to 1.5 times, which most fee income covers comfortably. It reaches 5.72% at a 2 times move, 20% at 4 times and 42.5% at 10 times. Past roughly 2 times, fee yields on most pools are no longer enough to compensate.
Can trading fees offset impermanent loss?
Often yes, and that is the entire point of providing liquidity. A pool paying meaningful trading fees on high volume can more than cover the loss on a pair that does not diverge much. The calculator returns the breakeven APY, which is the fee yield you would have needed over your time in the pool to come out level.
Does impermanent loss apply to stablecoin pools?
Barely. Two assets pegged to the same value almost never diverge, so impermanent loss in a USDC/USDT pool is close to zero. The trade-off is that these pools also pay the lowest fee yields, and the real risk shifts from price divergence to one of the stablecoins losing its peg.