How to Determine the Leverage?

How much leverage are Volatile Token holders taking on?

Volatile Token's precise Δ at any given time is based on the total relative supplies of Yield Token and Volatile Token, which are always changing.

i.e. when Volatile Token’s Δ = 2, a 10% increase in the price of the collateral asset would lead to a 20% increase in the NAV of Volatile Token.

A higher supply of Volatile Token relative to Yield Token --> lower effective leverage as volatility is absorbed over more Volatile Token.

Conversely, a larger supply of Yield tokens concentrates volatility on fewer Volatility Tokens --> higher effective leverage. xAVAX Leverage: Total Market Cap of The protocol/Total Market Cap of xAVAX Here's a detailed calculation that shows the Volatile Token leverage in different scenarios considering AVAX as the collateral asset: https://docs.google.com/spreadsheets/d/1fKvmTz3vYAQP35cH1Pa8dSUD1NCOTEIQO5vLijqiXHI/edit#gid=1189649717