Risk level explained

Vault Safety Score

While the strategy score is used to calculate initial and target allocations, the overall vault score is a summarized assessment of anti-risks with more generalized criteria, mostly adapted from Yearn. The score is a simplified safety rating designed to give users an estimation of the risk of a particular vault.

Simplicity

This is how the strategy earns its returns: is it a simple strategy like a Masterchef staking or does it have complex mechanics such as leverage, risk of liquidation, and involvement with multiple protocols? The fewer components it needs will require a higher simplicity rating. This score is essential in an emergency to evaluate how difficult it is to mitigate a live issue.

Longevity

How long the strategy has been running live.

Protocol Safety

Protocol Safety evaluates the resilience of the protocols the strategy uses. It takes into account the safety measures given the current DeFi security standards, based on our internal assessments and due diligence compared to the top projects in DeFI. This includes multi-sig health, decentralization, bounty programs, audits, etc.:

Rebalancing

Each strategy in a Rivo vault has initial and target allocations determined based on risk scores defined in Weighting. Scores consider factors like protocol TVL, liquid treasury, smart contract vulnerabilities, and more. Rivo reviews and updates the scores monthly, which in turn impacts the target allocations within the vault.

To optimize gas usage, Rivo sets a rebalancing threshold to avoid unnecessary gas consumption caused by immediate action on all changes in target allocations.

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