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Risks

Counterparty Risk

Liquidity positions are established on Trader Joe V2. This will add a layer of counterparty risk. Trader Joe is a reputable DEX and has undergone vigorous internal and external auditing.

Divergence Loss (Impermanent Loss)

As token prices diverge from their prices at deposit, your liquidity changes in value when compared to its value if tokens were held outside the pool. Large price swings could cause liquidity providers to lose money. The risk of impermanent loss can be amplified with concentrated liquidity.
Liquidity pools that contain assets that remain in a relatively small price range will be less exposed to impermanent loss. Stablecoins or pegged assets, for example, will stay in a relatively contained price range. These pools will generate fewer fees, though.
Trader Joe's Liquidity Book introduces variable fees that aim to compensate liquidity providers for impermanent loss. Variable fees provide liquidity providers compensation for managing impermanent loss under various trading dynamics.
Fee Adjusted Impermanent Loss/Gain Source: Trader Joe Liquidity Book Whitepaper

Price Volatility Risk

When there is significant volatility in the price of one or both assets in a position, the vault may temporarily become separate from the active bin. This will be dependent on the vault rebalancing frequency and the liquidity management strategy.
When liquidity is not within the active bin no swap fees will be earned during this time and the yield becomes reduced.