> For the complete documentation index, see [llms.txt](https://own-protocol.gitbook.io/docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://own-protocol.gitbook.io/docs/lp-short-strategy.md).

# LP Short Strategy

## The Most Capital-Efficient Way to Short?

What if you could short an asset by posting just 30% capital, with **no borrow costs**, no asset sourcing, and earn both PnL and interest? That’s what LPs in Own Protocol can do by backing synthetic exposure **without holding the asset**.

This isn’t just efficient. It’s powerful.

### Short Mechanics, Simplified

#### Starting Setup

* LP backs 500 synthetic units at $100
* Synthetic value = $50,000
* Posts $15,000 on-chain (30%)
* Holds **no** asset off-chain

#### Asset Falls to $80

* Synthetic value = $40,000
* **LP profit = $10,000** using only $15,000 in capital + Protocol Yield

### Why Own Is Built for Shorts

* No need to borrow assets
* On-chain margin model = minimal capital at risk
* Interest yield on top of PnL
* All enforced by protocol logic

### Summary

* Go short with just a fraction of the capital
* Earn on both price movement **and** protocol interest
* Ideal for directional LPs who want to profit from downturns
* And for sophisticated traders who know how to play the rebalance game