# Yield Distribution

**Yield distribution** is the process by which the earnings generated from the protocol's strategies are delivered to the holders of Avant's yield-bearing tokens (e.g., `savUSD`, `avUSDx`).

The protocol operates on a weekly cycle, referred to as an **epoch**. However, the distribution frequency varies between the Senior Tranches (e.g., `savUSD`) and the Junior Tranches (e.g., `avUSDx`).

### Yield Redistribution: The Junior Tranche Advantage <a href="#yield-redistribution-the-junior-tranche-advantage" id="yield-redistribution-the-junior-tranche-advantage"></a>

The **Junior Tranche** (e.g., `avAssetX`) is structured to receive a higher yield than the Senior Tranche (e.g., `savAsset`) in exchange for its role as the primary loss-absorption layer. This augmented yield is sourced from three distinct mechanisms:

1. **Baseline Yield**: All capital in the protocol (both Senior and Junior Tranches) earns the underlying base yield generated by the corresponding main strategy.
2. **Structural Yield Redistribution:** The Junior Tranche receives an additional yield allocation equivalent to **10%** of the total yield generated by all capital committed to the main strategy in the protocol. This entire portion is redistributed exclusively among the committed Junior Tranche capital.
3. **Protocol Treasury Contributions:** On rare occasions, the protocol treasury may contribute additional yield when considered appropriate.

## **Distribution for Senior Tranches**

The yield for Senior Tranche tokens is distributed in daily increments to provide a smooth and consistent appreciation in value.

* **Weekly Calculation:** The distribution cycle is anchored to a weekly epoch that begins **each Thursday**. At this time, the total yield generated during the previous week is calculated and finalized.
* **Daily Value Accrual:** This finalized weekly yield is then divided and distributed in portions each day. The daily distribution process is initiated at approximately 11:59 UTC. This daily value transfer increases the underlying value of `savAssets` (e.g., `savUSD`), meaning the amount of the corresponding `avAsset` (e.g., `avUSD`)  they can be redeemed for increases daily.

## **Distribution for Junior Tranche**

In contrast to the daily accrual for the Senior Tranches, the yield distribution for `avAssetX` tokens follows a weekly schedule.

* **Weekly Distribution:** Yield earned by the Junior Tranche is calculated and distributed once per week, on Thursdays, coinciding with the start of the new epoch.
* **User Impact:** This means the value of an `avAssetX` token reflects its earnings in a single, weekly update rather than through incremental daily increases.


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