Impermanent Loss Calculator
Estimate impermanent loss for a 50/50 liquidity pool from the asset price change. Formula: IL = 2√Pr/(1+Pr)−1, where Pr = current price / initial price.
Asset price when you entered the pool
Current asset price (Pr = P1/P0)
Price ratio Pr = 2.0000. IL is the % difference between LP value and holding the assets.
Formula: IL = 2√Pr/(1+Pr)−1. When Pr=1 (no price change), IL=0. When price moves up or down, IL is negative (you would have had more value by holding). This assumes a 50/50 pool and no fees.
What is impermanent loss?
Impermanent loss (IL) is the opportunity cost of providing liquidity to an AMM pool instead of holding the assets. When the price ratio between the two assets changes, the value of your pool share grows less than if you had simply held the assets. The loss is "impermanent" because if the price returns to the initial ratio, the loss disappears; if it does not, the loss is realized.
How to use this calculator
- Initial price (P0): Enter the asset price when you deposited into the pool.
- Current price (P1): Enter the current asset price. The calculator computes Pr = P1/P0 and then IL = 2√Pr/(1+Pr)−1.
- The result is shown as a percentage. A negative IL (e.g. −5.72%) means your LP position is worth about 5.72% less than if you had held the assets.
Why use our impermanent loss calculator?
All calculations run in your browser—no server round-trip—so you get instant results. Use it to compare providing liquidity vs. holding, to estimate IL before adding to a pool, or to explain the math to others. The formula applies to any 50/50 constant-product AMM (e.g. Uniswap-style); it does not include trading fees, which can offset IL.
Frequently asked questions
Why is impermanent loss negative?
IL is expressed as the difference between LP value and hold value. When the price ratio moves, the rebalancing in the pool causes the LP position to be worth less than holding, so IL is negative. A −10% IL means your LP share is 10% less valuable than holding the same initial amounts.
Does this include trading fees?
No. The formula IL = 2√Pr/(1+Pr)−1 only models the price-ratio effect. In practice, pool fees can partly or fully offset IL; you would need to add fee income separately to compare total LP return vs. holding.
When is IL zero?
When the price ratio Pr = 1 (current price equals initial price), IL = 0. The further Prmoves from 1 in either direction, the larger the (negative) impermanent loss.
Disclaimer: This calculator is for educational and informational purposes only. It does not account for fees, multiple assets, or concentrated liquidity. DeFi and liquidity provision involve risk; do your own research and consider consulting a qualified advisor.
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