# Basic Price Range Presets

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**Note for DEX Teams:**

This section introduces **price range presets** use in concentrated liquidity provisioning.

Use this section to help your users understand:

* How to set custom price ranges
* The difference between full-range vs. narrow-range provisioning

The examples below use **Algebra’s standard testnet UI and onboarding materials**, designed to illustrate key mechanics. These materials are **to be recreated and adapted** to match the final UI and UX of your DEX product.
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When providing liquidity, users allocate their assets to a specific **price range** — defined by the upper and lower bounds where their liquidity will remain active.\
This approach is central to concentrated liquidity AMMs and enables capital efficiency.

## Available Presets

To simplify this experience, DEXs built on Algebra can offer **preset ranges** designed for different user needs and risk appetites.\
These include: **Narrow**, **Common**, **Wide**, and **Full Range** options.

* **Narrow Range**\
  Example: –5% to +10% of current price

  > Designed for advanced LPs aiming to maximize fee generation through high concentration. Requires active management.
* **Common Range**\
  Example: –10% to +20%

  > Balanced option for moderate fee income and risk. Suitable for users with some DeFi experience.
* **Wide Range**\
  Example: –20% to +40%

  > Offers reduced exposure to impermanent loss and less frequent rebalancing. Good for more volatile pairs or passive LPs.
* **Full Range**\
  Covers the entire price spectrum

  > Emulates V2-style passive LPing. Simplest for new users but less capital-efficient.

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## Narrow vs Wide Ranges

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#### **Narrow Ranges** <a href="#narrow-ranges" id="narrow-ranges"></a>

* **High Fee Generation**: Generate more fees due to concentrated liquidity.
* **Constant Monitoring**: Require frequent rebalancing to stay within the active range.
* **High Impermanent Loss**: Heavily exposed to rapid price movements and IL.

#### Wide Ranges <a href="#wide-ranges" id="wide-ranges"></a>

* **Lower Fee Generation**: Generate fewer fees as liquidity is spread out.
* **Less Frequent Rebalancing**: Require less manual intervention.
* **Reduced Impermanent Loss**: Less affected by price movements.

## Choosing the Right Range

#### For Volatile Pairs

Pairs like ETH / USDT or ARB / USDT generally experience frequent price fluctuations.\
In these cases:

* **Wide ranges** are often ideal for low to mid-volume pairs, reducing rebalancing needs and impermanent loss.
* **Narrow ranges** may be profitable only on high-volume pairs, where trading fees are sufficient to outweigh risks and maintenance.

> 💡 *Tip for users*: Rebalancing a narrow position frequently incurs gas fees, slippage, and opportunity costs. Consider passive ranges unless confident in active management.

#### For Pegged Pairs

Pegged or stable pairs (e.g., USDT / USDC, stETH / ETH) are generally low-risk in terms of impermanent loss.

* **Very narrow ranges** (e.g., ±0.1%) are viable due to tight price correlation.
* In the event of a minor depeg, LPs can:
  * Close the position
  * Swap to rebalance
  * Reopen at the new price center

This strategy is only profitable if collected fees exceed the cost of repositioning. In low-volume environments, a **slightly wider preset** might be more practical to reduce management friction.