PT
Principal Token
PT is the principal claim of an SY position. Buy it at a discount today and redeem it for par value at maturity - the gap is your fixed, known-in-advance yield.
- Exposure
- Fixed yield
- At maturity
- Redeems to 1.0
- Best for
- Locking a rate
What is PT?
A Principal Token represents the principal portion of a yield position. It behaves like a zero-coupon bond: it trades below par before maturity, and is redeemable for one unit of the underlying value when the market expires. Holding PT means you give up the floating yield in exchange for a rate you lock in the moment you buy.
Economic model
PT is priced from an implied fixed APY. The further from maturity and the higher the APY, the deeper the discount. From purchase, PT accretes smoothly toward par (1.0). Adjust the controls below - the locked return updates live.
PT price now0.9721
Redeem at maturity1.0000
Locked return+2.87%
Annualized9.0%
A worked example
If PT trades at 0.9560 with 120 days to maturity, buying it locks roughly a +4.6% return over that period (about 14% annualized), assuming you hold to maturity and redeem at par.
Key properties
- The discount to par is your fixed yield if held to maturity.
- PT carries no exposure to changes in the floating yield rate.
- By default PT does not earn LiquidLink points.
- You can sell PT before maturity at the prevailing market price.
Before maturity, price can move
The fixed return is only guaranteed if you hold to maturity. If you sell early, PT trades at the market's current implied rate, which can be higher or lower than when you bought.