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For Depositors

As a depositor on PolyFund, you have the opportunity to invest in prediction funds managed by skilled predictors. This guide will walk you through the process of participating in funds and understanding your role as an investor.

⚠️ Important Disclaimers​

  • Fund Security: While managers cannot directly withdraw your funds, they can trade with them on prediction markets. Poor trading decisions or malicious activity could result in partial or complete loss of your investment.
  • Due Diligence: Always research fund managers before depositing. Ensure you fully trust the manager's expertise and intentions before committing any assets to their fund.
  • Smart Contract Risk: Like all DeFi platforms, PolyFund carries inherent smart contract risks despite security measures.

Understanding Fee Structure​

PolyFund implements two types of fees that vary by fund:

  1. Deposit Fees (up to 3%):

    • Charged immediately when you deposit assets
    • Determined by the fund manager (capped at 3% at the protocol level)
    • Deducted from your initial deposit amount

  2. Performance Fees (up to 30%):

    • Only charged if the fund generates profits
    • Represents the manager's share of profits (capped at 30% at the protocol level)
    • Calculated and distributed at the end of the fund's lifecycle

Always review and understand the fee structure of a fund before depositing. These fees directly impact your potential returns.

Understanding Fund Lifecycle​

Before investing, it's important to understand how funds operate on PolyFund:

  1. Open Stage: During this period, you can deposit assets into funds and receive fund shares in return. You maintain withdrawal privileges if you change your mind.
  2. Trading Stage: Once a fund enters this stage, no new deposits or withdrawals are permitted. The fund manager actively trades on Polymarket during this period.
  3. Closed Stage: After the trading end time, the fund concludes and performance is calculated. You can withdraw your original deposit plus any profits (minus applicable fees).

Getting Started as a Depositor​

Follow these steps to start investing in prediction funds on PolyFund:

1. Connect Your Wallet​

  • Visit the PolyFund platform through your web browser
  • Click "Connect Wallet" and select your preferred wallet provider (MetaMask, WalletConnect, etc.)
  • Ensure you're connected to the correct network (e.g., Polygon)

2. Browse Available Funds​

  • Explore the marketplace of available prediction funds
  • Review key details for each fund:
    • Fund name and manager
    • Trading start and end times
    • Deposit fee percentage (up to 3%)
    • Performance fee percentage (up to 30%)
    • Historical performance (for recurring managers)

3. Invest in a Fund​

  • Select a fund that aligns with your investment goals
  • Click "Deposit" and specify the amount of USDC you wish to invest
  • Review the deposit fee amount that will be deducted
  • Confirm your investment and approve the transaction in your wallet
  • You'll receive fund shares representing your stake in the prediction fund

4. Monitor Your Investment​

  • Track your fund's performance during the trading period
  • Review the manager's trading activity on Polymarket
  • Remember that withdrawals are locked during the trading stage

5. Withdraw Your Returns​

  • Once the fund enters the closed stage, you can redeem your shares
  • Navigate to "My Investments" and select the fund
  • Click "Withdraw" to redeem your initial deposit plus any profits (minus the manager's performance fee if the fund was profitable)
  • Confirm the transaction in your wallet

Important Considerations for Depositors​

  • Risk Assessment: All investments carry risk. Only invest what you can afford to lose.
  • Manager Evaluation: Research the fund manager's track record and reputation when possible.
  • Fee Impact: Calculate how the deposit fee and potential performance fee will affect your returns.
  • Fund Timeline: Note the precise trading start and end times to understand when your funds will be locked.
  • Diversification: Consider spreading investments across multiple funds to manage risk.

By following this guide, you can make informed decisions when participating in prediction funds on PolyFund.