We consider this LRTs historical tracking error to be moderately risk. After accounting for ETH’s volatility over the last 90 days, the market price has consistently remained within +/- 1% the underlying NAV, we’d like to see more consistency within 0.5%. Ideally, we’d like to see market price consistently remain within 0.5% of NAV over a longer period of time.

Using the slippage curve below and this LRT’s average daily volume, we consider the liquidity depth to be healthy. A trade matching ADV after liquidity has been depleted by 50% still has price impact below 5%. We estimate price impact by multiplying slippage by 2.5 and reduce by a factor of 6 if withdrawals are enabled.

We consider withdrawal availability for this LRT to be low. This LRT currently does not have an instant withdrawal buffer, and the majority of the LRT’s withdrawal volume in the past 30 days required more than 7 days to settle. We suggest this LRT improve their withdrawal availability.

We consider the current whale concentration for this LRT to be moderate. The largest whale holds less than 5% of the LRT’s total supply, but the 3 largest whales hold more than 5% of the total supply. We increase the threshold by a factor of 6 if withdrawals are enabled.