Investment Committee Newsletter - September 2024

The Investment Committee team presents its September 2024 newsletter, where we share insights surrounding the Capital Pool and Nexus Mutual’s investments. The goal is to make key data transparent and easily accessible to everyone.

State of the Capital Pool

Monthly Change

The Capital Pool has reduced by 0.92% in ETH terms this month. The largest impact was from withdrawals via the RAMM, but these withdrawals have notably slow down with 0.9k total redemptions in September, comparing to 2.8k ETH in August. There has been a small negative FX impact as a result of the stablecoin holdings due to the increase in ETH price in September, mitigated by very good results from Cover Fees and Investment holdings.

The various impacts on the capital pool are summarised in the waterfall chart below.

The cover fee income is net of distribution commissions and excludes covers paid for in NXM. In such a case, the cover fee gets burned and there is no change in the Capital Pool.

→ Members can track in/outflows on the Ratcheting AMM Dune Dashboard.

→ Members can track the cover income on the Covers Dune Dashboard.

End of Month Pool Split

The split of the Capital Pool at the end of September ‘24 in ETH terms is as follows.

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A portion of the DAI was again used to repay the outstanding Aave USDC loan and the largest portion of cover buys in September were again denominated in USDC.

→ Members can find the updated split at any time on the Capital Pool and Ownership Dune Dashboard.

Aave USDC Loan

On September 4th, the Advisory Board repaid 237k USDC from the Aave loan, bringing the outstanding debt balance at the time down from 5.74m to 5.52m USDC

State of the Investments

In the last month, the Mutual earned 87.4 ETH on its investments, overall, as broken down below.

stETH Monthly Return: 73.824
stETH Monthly APY: 3.048%

rETH Monthly Return: -16.499
rETH Monthly APY: -1.318%

Enzyme Vault Monthly Return: 31.522
Enzyme Vault Monthly APY: 2.705%
Enzyme Vault includes Kiln, EtherFi and Chorus One/Stakewise V3 investments

aEthWETH Return: 14.999
aEthWETH APY: 1.933%
debtUSDC Return: -16.421
debtUSDC APY: 9.016%
Aave Net Return: -1.422
Aave Net APY: -0.182%

Total ETH Earned: 87.424
Total Monthly APY: 1.294%
Based on average Capital Pool amount over the monthly period

All returns after fees

The active staking investments yielded between -1.3% and 3.0% APY.

The abnormally low yield on the Rocket Pool portion is a reversion of the 9% result in July. This is a result of an anomalous deviation in the ETH/rETH exchange rate at the end of July.

The Aave USDC debt position, collateralised by ETH, produced a net APY of -0.2%.

The Capital Pool overall earned 1.3% APY based on the average Capital Pool value over the course of the month. This is a lower-than-average result, driven by the anomalous Rocket Pool result.

Investment Committee Priorities

  • We are working with Enzyme and Chainlink to incorporate the unclaimed Kiln rewards into the NXMTY oracle; this update is still pending, as per the last update.
  • DAO Treasury investment: karpatkey has been onboarded as the DAO treasury manager, and they’ll begin managing treasury assets during October 2024.
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