VH
(the value from the hodl strategy) with VU (the value from the Uniswap strategy) to work out the difference VD
. It's more useful to find this as a fraction of VH
so we divide both sides by VH
.(VD/VH)
will always be ≤ 0, showing that there is always a Impermanent loss unless (p1/ p0)=1, i.e. p1=p0)