Fee Structure
Transparent fees for the 7N7D Trading Vault.
Fee Overview
| Fee Type | Rate | When Charged |
|---|---|---|
| Management Fee | 0.5% per year | Accrued daily |
| Performance Fee | 10% of profits | Above high water mark |
| Deposit Fee | 0% | Never |
| Withdrawal Fee | 0% | Never |
Management Fee
How It Works
- Rate: 0.5% annually
- Accrual: Daily (0.5% / 365 = ~0.00137% per day)
- Deduction: Automatically from vault NAV
Example
Vault Value: $1,000,000
Daily Management Fee: $1,000,000 × 0.5% / 365 = $13.70
Your Share: $10,000 (1% of vault)
Your Daily Fee: $0.137
Your Annual Fee: ~$50
Why This Fee?
Covers operational costs:
- AI infrastructure (compute, APIs)
- Blockchain gas costs
- Development and maintenance
- Security monitoring
Performance Fee
How It Works
- Rate: 10% of profits
- Trigger: Only above high water mark
- Calculation: On realized gains only
High Water Mark Explained
Month 1: Vault grows $1.00 → $1.10 (10% gain)
Performance fee: 10% × $0.10 = $0.01 per share
Month 2: Vault drops $1.10 → $1.05 (loss)
Performance fee: $0 (no profit)
Month 3: Vault grows $1.05 → $1.08 (3% gain)
Performance fee: $0 (still below $1.10 high water mark)
Month 4: Vault grows $1.08 → $1.15 (above high water mark!)
Performance fee: 10% × ($1.15 - $1.10) = $0.005 per share
New high water mark: $1.15
Why High Water Mark?
- You only pay fees on new profits
- Protects you from paying twice on recovered losses
- Aligns incentives: we only earn when you profit
Fee Comparison
How 7N7D compares to alternatives:
| Platform | Management | Performance | Deposit | Withdrawal |
|---|---|---|---|---|
| 7N7D Vault | 0.5% | 10% | 0% | 0% |
| Hedge Funds | 2% | 20% | Varies | Lock-ups |
| Robo-Advisors | 0.25-0.5% | 0% | 0% | 0% |
| CEX Earn | 0% | 0% | 0% | 0% |
Fee Destination
Where do fees go?
Fees Collected
│
├──► 70% Protocol Treasury
│ └── Development, operations, security
│
└──► 30% Buyback & Burn
└── Reduces $7N7D supply
Token Holder Discounts
Hold $7N7D tokens for reduced fees:
| Tokens Held | Management Fee | Performance Fee |
|---|---|---|
| 0 | 0.5% | 10% |
| 1,000,000+ | 0.4% | 8% |
| 5,000,000+ | 0.3% | 6% |
| 10,000,000+ | 0.2% | 5% |
Token holder fee discounts will be available in a future update.
No Hidden Fees
What We Don't Charge
- ❌ Deposit fees
- ❌ Withdrawal fees
- ❌ Transfer fees
- ❌ Account fees
- ❌ Inactivity fees
Trading Costs
Trading costs on Hyperliquid are:
- Deducted from vault returns
- Not additional fees to you
- Typical: 0.02% per trade
These are exchange costs, not 7N7D fees.
Fee Calculation Example
Scenario
- You deposit: $10,000 USDC
- Vault gains: 25% over the year
- Ending value before fees: $12,500
Fee Breakdown
Management Fee:
Average balance × 0.5%
~$11,250 × 0.5% = $56.25
Performance Fee:
Profit × 10%
$2,500 × 10% = $250.00
Total Fees: $306.25
Your Net Return:
$12,500 - $306.25 = $12,193.75
Net gain: $2,193.75 (21.9% return)
Effective Fee Rate
In this example:
- Gross return: 25%
- Fees: 3.06% of initial investment
- Net return: 21.9%
- Fee as % of profit: 12.3%
Smart Contract Details
Fees are handled transparently on-chain:
// Management fee accrual
uint256 managementFee = (totalAssets * 50) / 10000 / 365;
// Performance fee (simplified)
if (currentPrice > highWaterMark) {
uint256 profit = currentPrice - highWaterMark;
uint256 performanceFee = (profit * 1000) / 10000;
}
All fee calculations are verifiable on Arbiscan.
FAQ
When are fees deducted?
Management fees accrue daily. Performance fees are deducted when profits are realized.
Can fees change?
Only through governance vote. 48-hour timelock allows users to exit before changes.
Are fees tax-deductible?
Consult a tax professional. In some jurisdictions, investment management fees may be deductible.
What if the vault loses money?
No performance fee is charged. Management fee still applies (covers operational costs regardless of performance).
Next: View Historical Performance.