How to Use TokenSets as a DeFi Stop-Loss

Learn about a concept DeFi Dad recently posted about where you'd use TokenSets as a DeFi stop-loss. The idea is that if you want exposure to a TokenSet trading strategy (ideally a Robo Set) and if that criteria for a rebalance from ETH to a stablecoin is nearly met, you can buy a Set like ETH 20 Moving Average Crossover Yield and allow the Set to act like a stop-loss, selling out of ETH if the price were to fall.

Be aware there's always risk with smart contracts when you use a DeFi app like TokenSets and you should also think about the possibility that ETH could draw down in price, cause the Set to rebalance from 100% ETH to 100% cUSDC, and then move upwards before the Set can buy back ETH, meaning you're now buying back ETH at a higher price. That being said, check out the historical performance of ETH20SMACO Yield by going to determine whether this might work for you. It's much simpler than setting a stop-loss because you can leave your ETH in this Set in the hope it might outperform holding ETH.

Video by: DeFi_Dad
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Disclaimer & Risks: This is not financial advice and you should approach all DeFi applications with caution. TokenSets comes with smart contract risk and there's no guarantee that putting your money into a Set will outperform simply holding ETH.

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