# Fees

### Strategy Performance

SherpaEarn uses a **1.5 and 15** fee structure, this is a reduced version of the traditional "2 and 20" model commonly empoyed for hedge funds and managed strategies.

This consists of two components:

1. **Management Fee:** 1.5% annualized on total assets under management (AUM), accrued daily.
2. **Performance Fee:** 15% of yield earned by the strategy on each cycle.

<p align="center">Both fees are deducted from earned yield only — your principal <code>USDC</code> deposit is never touched. The APY displayed on the main SherpaEarn page reflects the net rate after all fees have been applied.</p>

#### Example of Fee Calculation & Deduction:

Assume 1,000,000.00 USDC in TVL. On cycle (day) 150, the strategy earns 400.00 USDC in yield.

* **Gross Annualized Yield** `(CycleYield × 365) / AUM` `(400.00 × 365) / 1,000,000 = 14.6%`
* **Daily Management Fee** `(AUM × 1.5%) / 365` `(1,000,000 × 0.015) / 365 = 41.10 USDC`
* **Performance Fee** `CycleYield × 15%` `400.00 × 0.15 = 60.00 USDC`
* **Net Annualized Yield (after fees)** `((CycleYield − ManagementFee − PerformanceFee) × 365) / AUM` `((400.00 − 41.10 − 60.00) × 365) / 1,000,000 = 10.9%`

{% hint style="info" %}
No fees are taken from incentive yields such a WMON rewards issued as part of the Monad Momentum Campaign.
{% endhint %}

***

### Bridging

0% fee, aside from the gas costs required to confirm the bridge request and process via Chainlink's DON.  The amount of `shUSD` bridged from the source network will always equal the amount of `shUSD` received on the destination network.


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