Network (gas preset)
Current position (out of range)
New position (after rebalancing)
| Item | Amount | Notes |
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When does rebalancing make sense?
A Uniswap V3 position earns fees only while the price is within your selected range. Once price exits the range, you earn zero fees and hold 100% of the cheaper asset. You have three options:
- Wait — if you expect price to return to your range soon, waiting avoids rebalance gas costs.
- Rebalance — close the old position, swap tokens to the correct ratio, and open a new position at current prices.
- Widen the range — add more capital to extend the range, at the cost of lower capital efficiency.
Rebalancing is only profitable if the fees earned in the new range exceed: gas × 2 (remove + add) + gas for the swap + the swap fee on the token rebalancing.
On Ethereum mainnet, this requires typically 10–30+ days of fee income to break even. On Arbitrum or Base, rebalancing becomes viable after 1–3 days of fees.
See also: Impermanent loss · Yield farming ROI · DeFi health factor
Frequently asked questions
When should I rebalance my Uniswap V3 LP position?
Rebalance when expected fee income in the new range exceeds gas + swap fees. On mainnet this requires at least $20–$50 in expected fees. On L2s, rebalancing is viable at much lower fee income.
What happens when an LP position goes out of range?
Your position stops earning fees. You become 100% exposed to one asset — if price goes above your range, you hold only the base token; below, only the quote token. You can wait for price to return or rebalance into a new range.
What are the costs of rebalancing a Uniswap V3 position?
Costs: gas to collect fees + gas to remove liquidity + swap fee to rebalance token ratio (0.05–1%) + gas for the swap + gas to add new position. Total on mainnet: $30–$150. On Arbitrum: $0.50–$3.
Is it better to widen the range or rebalance more often?
Wider range = more time in range but lower capital efficiency. Narrow range = higher fee APR when in range but frequent expensive rebalancing. For volatile assets, wider ranges often win. For stable pairs, narrow ranges are viable.
What is the break-even daily fee income to justify a rebalance?
Break-even daily fee = rebalance cost / days until you plan to exit. If rebalancing costs $50 and you hold 30 more days, you need $1.67/day in fees from the new position to break even.