Calculate exactly how much impermanent loss you would suffer in any AMM liquidity pool based on price changes.
Impermanent loss (IL) occurs when the price of tokens in an AMM liquidity pool changes relative to when you deposited them. The greater the price divergence, the more you lose compared to simply holding the tokens.
The loss is "impermanent" because if prices return to their original ratio, the loss disappears. But if you withdraw liquidity when prices differ significantly, the loss becomes permanent and real.
To offset IL, your earned trading fees + liquidity mining rewards must exceed the loss. This is why high-volume stable pairs (like USDC/USDT) have much less IL risk than volatile pairs.