Hedge Buffer Accrued — $10M LP Pool
| Pool age |
Buffer accrued ($) |
Buffer (% of LP NAV) |
Insurance LP ROE |
Total LP ROE (loop + insurance) |
Repeated payouts — how the buffer drains and rebuilds
Each negative-rate event drains the buffer. The buffer can only rebuild as fast as the LP's loop yield and premium income feed it. If a second event hits before the buffer has rebuilt, the second payout is smaller. Below: how total payouts behave when events repeat at different spacings, starting from a year-5 mature buffer.
| Event pattern |
Hedger payout
(% of insured notional) |
What this shows |