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

# How batched fund shares work

> Red Potion funds issue ERC-20 share tokens whose value tracks the fund's net asset value (NAV). This page explains how shares are priced, why deposits and redemptions are batched, 

Red Potion funds issue **ERC-20 share tokens** whose value tracks the fund's net asset value (NAV). This page explains how shares are priced, why deposits and redemptions are batched, and what that means for you as an investor.

## Shares, not balances

When you deposit into a fund you receive **shares**, not a claim on a fixed amount of the underlying asset. Each share represents a proportional slice of everything the fund holds. Your share count does not change on its own; instead, the **price per share** moves as the fund earns or loses value.

Red Potion prices shares using the convention:

```
shares = amount × 1e18 / price
```

Here `price` is the amount of the asset that corresponds to one share (scaled to 18 decimals). If a share is worth 1.05 USDC, then depositing 105 USDC mints you 100 shares. Redeeming 100 shares later, when a share is worth 1.10 USDC, returns 110 USDC (before fees).

## Why batches?

An automated vault can price a deposit the instant it arrives because it can read every position it holds directly from the chain. A Red Potion fund often cannot: its value may depend on positions held off-chain, in custody, or on another chain. So instead of pricing continuously, Red Potion divides time into **batches**.

A batch is a window of time with a **cutoff**. While a batch is open, deposits and redemptions queue into it. After the cutoff, an off-chain **reporter** submits the NAV price for that batch, and — after a mandatory review delay — an operator **accepts** the report. Acceptance settles every deposit and redemption in the batch at that one price, in a single transaction.

```
Batch N open ──▶ cutoff ──▶ reporter submits price ──▶ review delay ──▶ report accepted
   deposits &                                                            (batch N settles at
   redeems queue                                                          one fair price)
```

Two consequences follow, and both are deliberate:

**Everyone in a batch gets the same price.** There is no front-running the exchange rate within a batch — the price is fixed once, after the batch closes, and applied to all.

**Settlement is not instant.** Your deposit becomes shares (and your redemption becomes assets) only after the batch closes and its report is accepted. In exchange you get fair, manipulation-resistant pricing. See [Depositing](/using-redpotion/depositing) and [Redeeming](/using-redpotion/redeeming) for the full timelines.

## The safety rails on pricing

Because a single reported price settles a whole batch, the [Oracle](/developers/contract-reference/oracle) surrounds it with checks:

* **A mandatory review delay** (default 1 hour) sits between when a price is submitted and when it can be accepted, giving a reviewer time to veto a bad price.
* **A staleness limit** (default 7 days) prevents an old, out-of-date price from being accepted.
* **Suspicious-price bounds** — absolute min/max, maximum absolute change, and maximum percentage deviation from the last accepted price — flag any report that moves too far. A flagged report can only be accepted by a more privileged operator after manual review, or rejected and resubmitted.

## Native ETH and multiple assets

Funds can support multiple deposit and redemption assets, including **native ETH** (handled everywhere via the sentinel address `0xEeee…EEeE`). Each asset in a batch is priced by its own report, and the fund designates one **fee base asset** whose price drives time-based fee accrual and risk valuation.

## Key conventions at a glance

| Convention    | Detail                                                                           |
| ------------- | -------------------------------------------------------------------------------- |
| Share pricing | `shares = amount × 1e18 / price`, where `price` is asset-per-share               |
| Native ETH    | Supported everywhere, via sentinel `0xEeeeeEeeeEeEeeEeEeEeeEEEeeeeEeeeeeeeEEeE`  |
| Fees          | Paid in newly minted shares, never in assets — see [Fees](/using-redpotion/fees) |
| Cancellation  | Requests can be cancelled any time until their batch settles                     |
| Claims        | Never expire — you can claim settled shares or funded assets whenever            |