Trading in Lot units
Measure a completed trade in Lot units by comparing the Lot tokens spent with the Lot tokens received. More units is a gain in that denomination; fewer is a loss. The result depends on executed buy and sell prices after costs.
These examples use fixed Lots. Upcoming Dynamic Lots represent shares of current holdings instead. Trading results are separate from network rewards.
The ETH and SOL analogy
A trader who starts with 10 SOL, buys a speculative token and later sells it for 12 SOL has increased their SOL balance by 20%. Their dollar result also depends on SOL’s dollar price. Trading against ETH follows the same denomination logic.
Replace SOL with a fixed Lot token. Starting with 100 Lot tokens and ending with 120 means 20% more Lot units. If each token represents X, Y and Z in fixed quantities, those 120 tokens redeem for 20% more of each component than the original 100, subject to successful transfers and rounding.
The extra units come from a profitable trade. Holding a launch token or generating volume does not itself increase your Lot-token balance.
A complete worked example
Use the fictional recipe from Understanding Lots: each Lot token represents 0.005 X, 0.006 Y and 0.010 Z.
- You begin with 100 Lot tokens, representing 0.5 X, 0.6 Y and 1 Z.
- You spend those Lot tokens to buy a launch token. You now hold the launch token instead of those 100 Lot tokens.
- Later, an executable sale returns 120 Lot tokens after launch-token trading fees and price impact.
- You can retain the 120 Lot tokens or redeem them for 0.6 X, 0.72 Y and 1.2 Z, subject to healthy transfers and rounding.
Your Lot-unit gain is 20%. ETH gas and any costs of acquiring or liquidating the components remain additional expenses; the example has not deducted them.
If the sale instead returns 80 Lot tokens, you can redeem only 0.4 X, 0.48 Y and 0.8 Z. That is a 20% loss in Lot units.
Two moving prices determine dollar value
At a given instant:
launch-token price in USD = launch-token price in Lot tokens × Lot reference value in USD
For a completed trade that starts and ends in Lot units, before any separately excluded costs:
dollar return factor = (ending Lot units / starting Lot units)
× (ending Lot USD value / starting Lot USD value)
Assume the same 100-unit start, valued at $1 each:
| End Lot units | End value per Lot | End reference value | Lot-unit return | Dollar return |
|---|---|---|---|---|
| 120 | $1.00 | $120 | +20% | +20% |
| 120 | $0.75 | $90 | +20% | −10% |
| 80 | $1.50 | $120 | −20% | +20% |
| 50 | $1.20 | $60 | −50% | −40% |
These are arithmetic scenarios, not forecasts. A reference valuation is also not a guaranteed ETH liquidation quote.
In the third row, the original 100 Lot tokens would be worth $150 if retained. The trade ends at $120: a dollar gain from the starting value, but $30 less than holding the Lot. Compare both the denomination and the alternative holding when assessing performance.
Where additional Lot units come from
A successful sale draws Lot tokens from executable pool inventory supplied through market activity. It is a market exchange, not new component issuance or vault yield. Volume, holding a launch token and creator buybacks do not automatically credit you with more Lot tokens.
The launch token can fall against its quote even while the Lot rises in dollars. There is no price floor or guaranteed benefit from component appreciation.
Choose what to keep after a trade
- Keep Lot tokens: retain the complete fixed recipe as one redeemable unit.
- Redeem: receive every component token and manage them separately.
- Sell to ETH: request a complete route that also liquidates the components.
- Rotate: exchange the launch token for another registered launch token sharing the exact quote.
These outcomes have different costs and market requirements. See buy and sell and rotation before selecting an output.