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Liquidity Pool Impermanent Loss Calculator

Reviewed by the CalculatorHub team, edited by James Graham. Uniswap v2 constant product AMM formula (x*y=k). Last verified 14 June 2026.

When you provide liquidity to a decentralized exchange using a constant product automated market maker (AMM), the pool rebalances automatically as prices change. This rebalancing can leave you with less total value than if you had simply held both tokens. This calculator quantifies that difference using the standard impermanent loss formula derived from the x*y=k invariant used by Uniswap v2 and most AMMs.

+100% means Token A doubled in price relative to Token B
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0.00%
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Impermanent loss formula (constant product AMM)

Price Ratio (r) = New Price / Initial Price = 1 + Price Change % / 100
IL = 2 x sqrt(r) / (1 + r) - 1
Pool Value = Initial Deposit x (1 + IL)
HODL Value = Deposit A x (1 + Price Change / 100) + Deposit B
Net = Pool Value + Fees - HODL Value

Source: Uniswap v2 whitepaper (Hayden Adams, Noah Zinsmeister, Dan Robinson, 2020) and the x*y=k constant product formula.

Impermanent loss by price change (50/50 pool)

  • Price doubles (+100%): approximately 5.72% impermanent loss.
  • Price increases 4x (+300%): approximately 20.00% impermanent loss.
  • Price drops 50% (-50%): approximately 5.72% impermanent loss.
  • Price drops 75% (-75%): approximately 20.00% impermanent loss.
  • No price change (0%): 0% impermanent loss.

Impermanent loss: frequently asked questions

What is impermanent loss?

Impermanent loss (IL) is the difference in value between holding two assets in a liquidity pool versus holding them outside the pool. When the price ratio of the two assets changes, the automated market maker (AMM) rebalances the pool, leaving you with less total value than if you had simply held the tokens. The loss is called 'impermanent' because it disappears if prices return to the original ratio.

How is impermanent loss calculated for a constant product AMM?

For a constant product AMM (x * y = k, used by Uniswap v2 and most AMMs), impermanent loss is: IL = 2 * sqrt(price_ratio) / (1 + price_ratio) - 1. Where price_ratio = new_price / initial_price. For example, if one token doubles in price (ratio = 2), IL = 2 * sqrt(2) / (1 + 2) - 1 = 2.828 / 3 - 1 = -0.0572 = -5.72%.

Is impermanent loss always a loss?

Impermanent loss is a loss relative to holding. If fees earned from providing liquidity exceed the impermanent loss, you can still be better off than simply holding. The net position depends on trading volume, fee rate, and the magnitude of price changes during your deposit period.

Does impermanent loss apply to stablecoin pairs?

Stablecoin pairs (e.g., USDC/USDT) experience minimal impermanent loss because their prices rarely diverge significantly. Concentrated liquidity AMMs (Uniswap v3) can also reduce impermanent loss by focusing liquidity in a narrow price range, but increase it if prices move outside that range.

When does impermanent loss become permanent?

Impermanent loss becomes a realized (permanent) loss when you withdraw your liquidity at a point where the price ratio has not returned to the original ratio. If you deposit and withdraw at the same price ratio, impermanent loss is zero (you only gained fees). If you withdraw after a large price divergence without recovering fees, the loss is locked in.

Official sources

Reviewed by the CalculatorHub team, edited by James Graham, 14 June 2026. See our methodology.