Calculations for Index Yield

In order to rank the various Indexes, we calculate the APR for each index based on its earnings accrued over the most recent week. We first calculate the APR for each validator in an index and use this information to determine the average APR. The average APR is displayed as the APR for the index. Calculation of APR for the protocol is not as simple as considering the profits and losses for the validators and then calculating the annual yield. Stakehouse is a shadow ledger of the Consensus layer that works in an asynchronous manner - the ledger only updates when balance reporting is initiated. Because of this, it is non-trivial to calculate the time period for which a validator has earned rewards. A validator’s APR is calculated from the time it becomes active to the present moment.

It is important to understand that both rewards and leakages on the Consensus layer are accounted for in ETH. With Stakehouse, rewards are reflected by the minting of dETH, and leakages are reflected by the slashing of SLOT tokens. Since we are monitoring the Indexes and tracking dETH, we only consider rewards when tracking APR. A validator’s overall APR is calculated from the total rewards it has earned since its activation. This metric is then used to calculate the average rewards earned per day, which helps predict how much the validator will earn over one year. When this is compared to the initial deposit of 24 dETH, it gives us the APR. Thus the yield you see is based on the rewards earned by the validator.

For calculating the weekly APR daily at 12 AM UTC we get earnings of the last 1575 Epochs (1575 Epochs = 7 Days) and calculate the APR using the Formula:

$$APR\ =\ \frac{Earnings\ In\ Last\ 1575\ Epochs}{1575}\ *\ \frac{Number\ Of\ Epochs\ In\ A\ Year}{Initial\ dETH\ Deposit}\ *\ 100$$

This ensures accuracy when calculating dETH Rewards APR while using epochs in the formula. An index’s APR is calculated from its performance on a week-by-week basis, which is then used to calculate its index ranking. Index rankings are available on the Stakehouse Leaderboard at https://joinstakehouse.com/monitoring.

In addition to APR rankings, the leaderboard also ranks indexes based on the total dETH rewards they receive and the penalties they incur.

If you want to verify the yields you can do so by visiting hosted notebook