# Where the Yield Comes From LsRWA Tokens give you **100 % price exposure** to the underlying asset **plus** **additional APY** (i.e. 2-5% APY).\ That additional return is generated by multiple “overlay” strategies that run in the background at our regulated custodian/broker, always hedged so your net market exposure stays unchanged. Some of these strategies include futures basis, insured lending, covered-call overwrites, etc. as well as novel on-chain strategies with web3 protocols and safe assets such as stablecoins or US treasury back tokens. ### Yield Flow 1. **Daily P\&L report** — Custodian calculates net profit / loss across all overlays and assets. 2. **Vault Update** — Ops posts the figure on‑chain; vault/LsRWA token share‑price moves accordingly. 3. **Performance fee** — 20 % of positive P\&L is sent to the FeeRouter; 80 % is sent in the staking vault. A majority of this fee is sent to RWAL stakers. 4. **Auto‑compounding** — Your LsRWA Token price rises; no action required to realize gains. ## Risk Management Max drawdowns, low leverage, independent oversight, and working directly with risk management companies are just some of the ways Lendr ensures strategy risk is robustly managed. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://whitepaper.lendr.fi/how-it-works/where-the-yield-comes-from.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.