> ## Documentation Index
> Fetch the complete documentation index at: https://docs.vanna.finance/llms.txt
> Use this file to discover all available pages before exploring further.

# Dual Yield Stack

> Supply USDC to Vanna's Earn pool while simultaneously running an XLM rate carry in Margin - stacking two independent yield streams with no directional price exposure.

<Info>
  **Sections used:** Earn · Margin · Farm  ·  **Delta exposure:** None  ·  **Risk level:** Low–Medium  ·  **Complexity:** Medium
</Info>

Supply USDC to Vanna's Earn pool for passive stablecoin yield. At the same time, deposit USDC as Margin collateral, borrow XLM, and supply the borrowed XLM to a Blend XLM single-asset pool. The two strategies run independently and in parallel - each with no directional price exposure - producing two separate yield streams from the same capital base.

## Why this is delta-neutral

**Earn leg (USDC):** USDC is a USD-pegged stablecoin. Supplying it to Earn carries no meaningful price risk.

**Carry leg (XLM):** Your borrow is denominated in XLM and your farm position is denominated in XLM. Any XLM price movement affects both equally and cancels out - leaving only the rate spread as the source of return.

Combined, neither leg has directional exposure. The strategy earns from two rate differentials - the USDC lending yield and the XLM carry spread - running simultaneously without either one affecting the other.

## How to execute

<Steps>
  <Step title="Supply USDC to Earn">
    Go to **Earn** → select the USDC pool → **Supply** your USDC. Your vUSDC tokens begin accruing yield immediately. No further action needed on this leg.
  </Step>

  <Step title="Open a Margin Account">
    Go to **Margin** → **Open Account** if you don't have one yet. See [Open a Margin Account](/guides/margin/open-account).
  </Step>

  <Step title="Deposit USDC as Margin collateral">
    Go to **Margin** → **Deposit & Borrow** → deposit USDC from your wallet. This backs the XLM borrow independently of the Earn position.
  </Step>

  <Step title="Borrow XLM">
    In the borrow panel, select XLM as the borrow asset. Keep Health Factor at **1.5× or above**. Since your XLM farm and debt will cancel each other on price, HF is insulated from XLM price moves - the main risk is accruing interest.
  </Step>

  <Step title="Supply borrowed XLM to the Blend XLM pool">
    Go to **Farm** → **Single-Asset Pools** → select the Blend XLM pool → enter your full XLM balance → click **Add Liquidity** and confirm. This leg is now live alongside the Earn position.
  </Step>
</Steps>

## Example

|                                    |                                               |
| ---------------------------------- | --------------------------------------------- |
| USDC supplied to Earn (Leg 1)      | \$500 USDC                                    |
| USDC Earn APY                      | 8% → earns \$40/year                          |
| USDC Margin collateral (Leg 2)     | \$400 USDC                                    |
| XLM borrowed (at conservative LTV) | \$200 worth of XLM                            |
| XLM deployed to Blend XLM pool     | \$200 worth of XLM                            |
| Blend XLM Supply APY               | 12% → earns \$24/year                         |
| Vanna XLM Borrow APR               | 8% → costs \$16/year                          |
| **Net annual yield (both legs)**   | **$40 + $24 − $16 = $48**                     |
| **Total capital deployed**         | **$900 ($500 Earn USDC + \$400 Margin USDC)** |
| **Net XLM price exposure**         | **Zero**                                      |

<Note>
  Both legs must independently be profitable. The carry leg earns positively only when Blend XLM supply APY exceeds Vanna XLM borrow APR. Monitor each leg's rates separately.
</Note>

## Managing the two legs

The Earn leg and the carry leg are independent - you can adjust or exit either one without affecting the other.

* **To exit the Earn leg:** Go to **Earn** → **Withdraw** → redeem your vUSDC tokens.
* **To exit the carry leg:** Go to **Farm** → remove XLM liquidity from Blend → go to **Margin** → **Repay** → repay the XLM borrow → withdraw USDC collateral.

## Risk profile

| Risk                  | Level  | Notes                                                             |
| --------------------- | ------ | ----------------------------------------------------------------- |
| USDC price risk       | None   | USDC is USD-pegged                                                |
| XLM price risk        | None   | XLM farm and XLM debt cancel each other exactly                   |
| Liquidation risk      | Low    | HF on the carry leg only changes from accruing interest           |
| Rate risk (Earn leg)  | Low    | USDC Earn APY fluctuates with pool utilization                    |
| Rate risk (Carry leg) | Medium | XLM carry turns negative if borrow rate exceeds Blend supply rate |
| Smart contract risk   | Low    | Inherent to all on-chain protocols                                |

## What to monitor

**Carry leg rate spread** - Check the Vanna XLM borrow APR vs Blend XLM supply APY periodically. If the spread inverts, exit the carry leg while keeping the Earn leg intact.

**Health Factor** - Only the carry leg has a Margin Account and therefore a Health Factor. Monitor it separately from the Earn position.

## Related

* [Supply to Earn](/guides/earn/supply)
* [Borrow](/guides/margin/borrow)
* [Single-Asset Pools](/guides/farm/blend-pools)
* [Health Factor](/guides/margin/health-factor)
* [Repay](/guides/margin/repay)