Internal Rate of Return (IRR)

What does the IRR metric on the Vault page represent?

IRR stands for Internal Rate of Return which is defined on Investopedia as the profitability of potential investments. In vault system, the IRR provides a representation of the performance of the vault from inception (meaning an account of its past performance).

IRR is a holistic measure that gauges the overall profitability of a Vault. It is important to note, however, that IRR is denominated in deposit asset terms. Meaning if you deposit 1 ETH and now have 1.10 ETH worth of tokens in your position, the IRR is 10%.