> ## Documentation Index > Fetch the complete documentation index at: https://docs.loopscale.com/llms.txt > Use this file to discover all available pages before exploring further. # Loop **Loops** are structured products that enable **one-click, leveraged exposure to yield-bearing assets** such as liquid-staked SOL, LP tokens, fixed-yield tokens, real-world yield, and other tokenized yield primitives. By looping, users borrow more of the same asset they deposit, creating a compounding position where both the initial and borrowed tokens earn yield. Loopscale uses **fixed-rate loans** to power Loops, helping to mitigate rate volatility that can otherwise erode leveraged returns. Loop positions can be: * **Market-neutral:** stablecoin or staked-asset loops * **Directional:** including long or short-biased positions on volatile assets Learn more about the mechanics behind Loops [here](/protocol-concepts/loops). If you're looking for help with your Loop, a good place to start is [FAQ and Common Issues](/using-loopscale/loop#faq-%26-common-issues). ## Open, Manage, Roll Over, and Close Loops 1. Visit the [Loops](https://app.loopscale.com/loops) page in the Loopscale App. 2. Choose a Loop. See [Loop Types](#loop-types) for more detail. 3. Review whether the position is market-neutral or price-sensitive. 4. Select your **leverage**. Higher leverage increases both yield and liquidation risk. 5. Choose optional settings: **Slippage tolerance** and **fixed-rate duration** (longer durations reduce rate risk, but may have higher rates and/or less liquidity). 6. Confirm and execute the transaction. Managing your Loop is important, especially for directional positions. You can monitor and adjust your position from the [Portfolio](https://app.loopscale.com/portfolio) page or directly within a Loop’s detail view. Track leverage, liquidation threshold, and projected yield based on current rates and optionally **top-up collateral** to reduce leverage and improve loan health or **refinance** (if available) to adjust term or improve cost basis. For more detail, see [Managing Loans](/using-loopscale/borrow/health-and-liquidations). Looped assets with maturity dates (e.g., PT assets) can be rolled over to the next maturity date if a supported Loop exists for that date. The rollover option will appear for eligible Loops once they reach expiry. Rolling over extends your yield-earning period until the next maturity date and typically incurs lower fees and slippage compared to closing and reopening a new Loop. To close a Loop: 1. Navigate to the [Loops](https://app.loopscale.com/loops) page or your [Portfolio](https://app.loopscale.com/portfolio). 2. Select the active Loop position you wish to close. 3. Execute the close transaction. The position is unwound automatically. You can manually loop assets when there isn’t enough market liquidity for an existing Loop or if you want to loop assets that don’t yet have their own Loopscale Loop. Manual loops can also give better pricing and execution. Using JupSOL/SOL as an example: 1. Borrow SOL against JupSOL collateral 2. Swap SOL for more JupSOL 3. Go to your initial SOL loan, click **Manage** → **More**, select **Add Collateral**, and add the JupSOL 4. If you wish to continue looping, click **Borrow More** to borrow additional SOL 5. Repeat steps 2–4 until you reach the desired leverage. If a Loop can’t be closed automatically, **you can manually close it by repaying the debt and withdrawing the collateral**. For example, with a JupSOL/SOL Loop, you repay SOL to withdraw your JupSOL collateral. **If you have enough idle funds, you can repay the full debt and withdraw all collateral at once**. This is the fastest option, but it requires enough funds to cover the full repayment. **If you don’t have enough to repay everything at once, you can close gradually — repaying in smaller steps using withdrawn collateral.** Note: your loan’s LTV must not be between the maximum LTV and liquidation LTV for manual closing to work. **Full Repayment** 1. Go to your Loop and click **Manage**, then **More** (next to *Close Loop*). 2. Select **Repay** and repay the full amount. 3. Select **Withdraw Collateral** and withdraw the maximum amount.\ Your Loop is now closed. **Gradual Repayment (if you can’t repay all at once)** 1. Go to your Loop and click **Manage**, then **More** (next to *Close Loop*). 2. Select **Repay** and repay a small portion of the debt (optional but may be required for the next step). 3. Select **Withdraw Collateral** and withdraw the maximum amount available. 4. Swap (on a DEX) or redeem (e.g., on Exponent or RateX for PTs) the withdrawn collateral into the asset needed for repayment. 5. Repeat steps 2–4 until all debt is repaid and all collateral is withdrawn. Each round lets you repay more debt and free more collateral until the Loop is completely closed. ## Risk Management Loops introduce amplified exposure. While they are designed to boost returns from yield-bearing assets, they also come with meaningful risks: * **Asset price volatility:** Directional Loops (e.g. long or short) can be liquidated if the underlying asset moves against the position. * **Yield vs. borrow rate mismatch:** If your asset’s yield drops below your fixed borrow rate, the strategy may become unprofitable. * **Liquidity constraints:** AMM liquidity must be sufficient to open or close Loop positions. If unavailable, users may face slippage, need to wait, or [close manually](/using-loopscale/loop#manually-close-a-loop). Loopscale mitigates rate volatility using **fixed-rate loans**, but users should still monitor Loop health and understand the risks involved. See additional considerations on the [Risk Management](/resources/risks-and-security) page. ## Understanding Returns Loop P\&L depends on: * The **yield rate** of the asset being looped * The **borrow rate** and fixed duration * The chosen **leverage multiplier** * Any associated fees (origination, slippage, early close before maturity for PTs) * **Underlying asset pricing** A Loop is profitable when the compounded yield on the looped tokens exceeds the borrow costs and any third-party fees to open or close the position (such as swap fees). Yield is typically more likely for assets with high or stable base yields. To learn more about pricing for particular tokens, see [Pricing & Custom Oracles](/resources/asset-parameters#pricing-%26-custom-oracles) ### Loop Types Different Loops have distinct risk profiles and performance dynamics based on the yield asset and debt asset. Loops on tokens like mSOL, JupSOL, or restaking tokens earn a spread between staking yield and borrow rate. * **Yield Source**: Staking rewards * **Liquidation Risk**: Not based on price volatility — driven by staking yield falling below borrow cost or validator underperformance * **Best Use**: Capital-efficient compounding of stable staking yields These use LP tokens from perpetuals platforms like JLP or FLP to amplify exposure to trading fee revenue. * **Yield Source**: Perp trading fees * **Liquidation Risk**: High — depends on price movement of underlying assets * **Position Bias**: Directional (not market-neutral) Loop LP tokens from dynamic DEXes like MLP (Meteora), to compound fee revenue. * **Yield Source**: DEX trading fees * **Liquidation Risk**: Price movement of the LP token; not neutral * **Use Case**: Similar to Perps LPs but from spot DEX exposure Loops on **Principal Tokens (PTs)** that trade at a discount to their face value and redeem 1:1 at maturity. * **Yield Source**: Fixed income (discount to par) * **Liquidation Risk**: Low if LTV \< 80% — price closely tracks SOL unless market reprices yield aggressively * **Full APY is only realized if held to maturity**. Early exit may return less than projected yield. Loops on xStocks like CRCLx, NVDAx, and SPYx provide leveraged long or short exposure to these tokenized equities. **Yield Source**: xStock Loops do not provide yield; rather, they provide leverage for directional positions. **Liquidation Risk**: Low to high depending on leverage and stock volatility; depends on movement of these assets. **Use Case**: Leveraged long/short exposure to equities. A CRCLx / USDC Loop would have you with leveraged long exposure to CRCLx, whereas a USDC / CRCLx Loop provides you with leveraged short exposure to CRCLx. xStocks on Loopscale are not available to US persons. ## FAQ & Common Issues ### 'Market does not have enough SOL supplied' when opening a loop Loops rely on swaps via AMMs (like Orca or Raydium). This error means there isn't enough liquidity in the AMM pool to complete the Loop at your selected size. Try reducing leverage or selecting a different Loop. ### 'No Route Found' when closing a Loop This indicates insufficient liquidity in the AMM to close the Loop. You can wait for AMM liquidity to recover or [manually close your Loop](/using-loopscale/loop#manually-close-a-loop). ### Unexpected negative PnL, particularly after opening a position Loops can show negative yield if market conditions move against the position, such as changes in underlying asset values, high borrow rates, or insufficient collateral yield. *PnL can also start negative due to costs associated with opening a Loop, particularly at higher leverages*. **For leveraged PT and LST Loops, negative PnL is often temporary**, especially immediately after opening a Loop. This usually reflects execution costs and conservative estimates rather than poor performance. For LSTs, negative PnL often resolves when staking rewards are distributed. For PT loops, true value becomes apparent at maturity or as market liquidity improves. For a better estimation of PnL, you can simulate pricing by clicking **Close Loop** to simulate closing the position in your wallet, without confirming the transaction. This will show a more accurate estimation as it is a simulated transaction rather than an estimation. **What can affect your PnL:** Opening a Loop requires multiple AMM swaps to create leverage, each incurring roughly AMM fees. With leverage, these costs multiply—a 3x leveraged Loop will have 3x the fees. Your PnL uses Loopscale's "fair value" pricing, but actual market prices may differ. We call this the "Swap Difference". * **LSTs (jitoSOL, mSOL, fragSOL):** Often trade below theoretical value until staking rewards are distributed at epoch end * **PTs (RateX tokens):** Frequently trade at discounts in AMMs due to low liquidity and early exit risk. Since PTs only realize full yield at maturity, AMM prices may reflect additional discounts The system shows conservative estimates assuming maximum slippage and fees. This is especially pronounced for PT loops, where calculations include potential early exit penalties you won't pay if holding to maturity. Directional loops like JLP or MLP have leveraged exposure to underlying pool assets. If you're looping JLP (containing SOL, ETH, BTC, etc.), you're taking a leveraged long position on that basket. When these assets decline, losses are amplified by your leverage multiplier. Fixed-rate borrowing costs accumulate over time. If your looped asset's yield doesn't exceed this rate, PnL will gradually decrease. This is indicated by a negative APY on a Loop. ## Market Hours For certain assets, Loops can only be closed or fully repaid during market hours. Open market hours are as follows for these assets: | Asset | Market Hours (EST) | Description | | :----------------------- | :------------------------------------------------------ | :-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | | **xStocks** | Weekdays 9:30am–4:00pm | xStocks are tokenized equities such as NVDAx or CRCLx. [They are available during U.S. market hours](https://www.kraken.com/legal/xstocks). | | **Flash Pool 2 (FLP.2)** | Sunday 5pm - Friday 5pm, with a daily hour break at 5pm | Flash Pool 2 provides liquidity for synthetic tradeable assets across oil, FX, and metals. This market is available during [CME FX/Metals/Oil market hours](https://docs.flash.trade/flash-trade/flash-trade-protocol/technical-architecture/synthetic-pool-2). |