> For the complete documentation index, see [llms.txt](https://koge.gitbook.io/kogefarm/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://koge.gitbook.io/kogefarm/why-autocompound.md).

# Why Auto-Compound?

> Compound interest is the most powerful force in the universe. - Albert Einstein

It is well known that **compounding reward tokens** can significantly increase returns. This is particularly true for farms that offer a high APR, whose rewards should be frequently harvested + compounded for maximum returns. 

When you stake LP tokens in our vaults, our smart contract deposits it into the underlying farms (e.g. PolyCat, PolyGaj) for their reward tokens, which it then **automatically harvests and compounds** into more LP tokens for you. As the table below shows, the gains from such continuous compounding, relative to even daily manual compounding, is sizable with an APR of 1000%, and really blow up as we reach 1500%. 

| APR   | Daily Compounding APY | Continuous Compounding APY | **Gain from Continuous Compounding** |
| ----- | --------------------- | -------------------------- | ------------------------------------ |
| 50%   | 65%                   | 65%                        | **0.1%**                             |
| 100%  | 171%                  | 172%                       | **0.4%**                             |
| 500%  | 14246%                | 14741%                     | **495.2%**                           |
| 1000% | 1925283%              | 2202547%                   | **277263.3%**                        |
| 1500% | 242168170%            | 326901637%                 | **84733467.7%**                      |
| 2000% | 28593725424%          | 48516519441%               | **19922794017.3%**                   |
| 3000% | 331928372898689%      | 1068647458152350%          | **736719085253657.0%**               |

This analysis above is why we think our **auto-compounding** service focused on the **high APR farms** on Polygon would generate significant value for the users. Another benefit of using our service is that users don't have to engage with the market daily, which can be helpful especially because the Matic mainnet can get congested at times. 

Furthermore, unlike the other services, we don't charge their [high fees](/kogefarm/fees.md) which can negate the benefits of auto-compounding. 

Finally, users should note that high APY farming is inherently risky. [Click here](/kogefarm/faqs/why-is-the-apy-so-high-and-what-are-its-risks.md) for our FAQ on that.


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