Manager fees

This section explains the manager fee structure and its mechanics on Valio

There are 2 types of manager set fees on Valio:

1. Management fees

2. Performance fees

The vault manager can configure these to whatever values they like. These can be set only on vault creation and can not be changed after.

Management fees

Management fees are set as % annually. These are the fees charged by a manager that are not performance dependent. They are released to the manager every block, and can be claimed any time.

Performance fees

Performance fees are based on the "high watermark" principle. This means that the manager can only claim additional performance fees when they exceed the Vault value at which performance fees were claimed previously.

Example:

Suppose a manager sets a 2/20 fee structure (2% management, 20% performance fees)

Suppose also their initial Vault AUM is 1m USDC. The manager achieves a 30% return in 6 months to achieve a total Vault value of 1.3m USDC. How much in performance fees are they entitled to? The manager made 300k USDC, so they are entitled to 20% of that = 60k USDC The next time they will be able to claim performance fees, is when the Vault value exceeds 1.3m So suppose in 6 more months, the Vault value becomes 2m USDC. Relative to the previous high watermark of 1.3m, the manager has earned additional 700k. Thus, they would be entitled to: (current Vault value - previous high watermark)*performance fees, which in this case: (2m - 1.3m)*20% = 700k*20% = 140k USDC

Claiming Fees

On the Manage page for the vault you wish to claim fees from, in the top left you'll see "Fees earned", a $ value, and a Claim button. As long as you have more than $2 claimable, you can click to claim.

Claim fees button, with $0 earned

If you have a multi-chain Vault, you will first be asked to sync your vault-state across all the chains it's deployed to; afterwards you can claim.

Claim fees modal, Step 2/2 processing for ~$26

Your claimed fees are kept in the Vault and continue to be tradeable as with all AUM. You can withdraw your Manager Fees from the Vault by clicking Withdraw and selecting the "My manager fees" tab.

Withdraw from vault modal, My manager fees tab

The value displayed to be claimed is from other depositors. In other words, this amount does not include the amount you are "claiming" from yourself.

You may notice the "My capital in vault" value decrease. It has simply shifted to the "My manager fees" tab inside of the Withdrawal window.