# How do vaults work on Hyperliquid?

Stage 1 · Survey the ground (know the market you trade) · Updated 2026-10-24

A vault on Hyperliquid is one trading account that many people fund. A leader trades it; depositors own a share of it and share its profit or loss. When you withdraw from a user vault, the leader receives 10% of your profit. Deposits in a user vault are locked for one day, and withdrawing can close part of the vault’s positions to pay you.

## In short

- A **vault** is one trading account funded by many depositors. Each owns a share of it and shares its profit or loss.
- A **leader** trades a user vault. Creating one costs a 10,000 USDC fee, and the leader must keep at least 5% of the vault at all times.
- The leader receives **10% of your profit** when you withdraw: a $1,000 share that grows to $2,000 pays out $1,900.
- When the vault lacks the free margin to pay you, it cancels orders that use margin, then closes **20% of its positions** at a time until it can.
- Deposits in a user vault are **locked for one day**. HLP, the protocol’s own vault, locks them for four.

## What a vault is

A **vault** on Hyperliquid is a pool of money traded as one account. Depositors put money in and own a share of it, and the vault’s profit or loss is split between them in proportion to those shares.

There are two kinds. A **user vault** is led by a trader, who decides every trade. A **protocol vault** is run by Hyperliquid itself, with no fees and no profit share; [HLP](https://buildtrade.app/guides/what-is-hlp/) is the best known.

## What the leader puts in and takes out

Creating a vault costs a 10,000 USDC fee, which goes to the protocol in the same way as trading fees. The leader must deposit at least 100 USDC and keep at least 5% of the vault at all times, and cannot withdraw below that. Their own money rises and falls with the depositors’.

In return the leader receives a 10% profit share for managing the vault. It comes off the profit, not the deposit: in Hyperliquid’s own example, a 100 USDC share that grows to 200 pays out 190.

## What your share is worth

Depositing buys a share. Put $1,000 into a vault holding $9,000 and you own 10% of the $10,000 it now holds. If the vault doubles to $20,000, your share is worth $2,000. The leader’s 10% of the $1,000 profit is $100, so a withdrawal pays $1,900.

A loss works the same way down. A 20% fall leaves the share worth $800, and with no profit there is nothing for the leader to take.

## How a withdrawal is paid

A vault pays a withdrawal from its free margin. If it has enough, its open positions are not touched. If it does not, open orders that are using margin are cancelled first. If that is still not enough, 20% of the vault’s positions are closed, and again, until the withdrawal can be paid.

A leader can instead set the vault to always close positions in proportion on withdrawals, which keeps its liquidation prices similar. Either way, positions closed to pay you out can cost some slippage, so the amount paid can differ a little from the value on screen.

## The lock-up

Deposits in a user vault are locked for one day. HLP, the protocol vault, locks them for four days, counted from your most recent deposit, so every top-up moves the date.

A lock-up means a deposit is not cash on hand the moment it lands. Money that may be needed within the lock-up is money a vault cannot give back in time.

## On Hyperliquid

Every vault has its own page, showing its performance, its depositors and how long each has been in. Hyperliquid notes that a vault’s past performance is no guarantee of future returns.

The vaults described here are Hyperliquid’s legacy vaults, introduced in 2023, which do not support HIP-3 markets or spot trading. Newer vaults built on HyperEVM reach spot and HIP-3 as well. A leader can close a legacy vault from its page once all of its positions are closed, and depositors then receive their share.

In BuildTrade™, the Track Record page keeps the same kind of record for your own trading: every closed trade as one equity path, and every period’s result, traded or not.

## One share, four results

_Example numbers._

The same $1,000 deposit, 10% of a $10,000 user vault, withdrawn after four different results for the whole vault, with nobody else depositing or withdrawing. The leader receives 10% of any profit.

- Deposit: $1,000
- Your share: 10%
- Leader’s profit share: 10%
- Lock-up, in days: 1

| Vault result | Your share | To the leader | Paid to you | Your result |
| --- | ---: | ---: | ---: | ---: |
| −20% | $800 | $0 | $800 | −$200 |
| +5% | $1,050 | $5 | $1,045 | +$45 |
| +20% | $1,200 | $20 | $1,180 | +$180 |
| +100% | $2,000 | $100 | $1,900 | +$900 |

The profit share comes off gains only: at −20% the leader takes nothing, and at +100% they take $100 of your $1,000 profit. Any slippage from closing positions to pay you would come off as well.

## Mistakes that cost traders money

- **Reading the vault’s return as yours.** The leader’s 10% comes off your profit when you withdraw, so a depositor in a vault that doubles keeps 90% of the gain, not all of it.
- **Judging a vault by where it ended.** The performance page shows the whole path. The deepest fall from a high is what a depositor would have sat through; the end point shows none of it.
- **Expecting the value on screen at withdrawal.** If the vault lacks free margin, it closes positions to pay you, and that can cost slippage.
- **Forgetting the lock-up.** Money in a user vault is locked for one day, in HLP for four. A deposit is not cash on hand the moment it lands.
- **Reading the leader’s stake as safety.** A leader must keep at least 5% of the vault, so their own money moves with yours. That aligns them with depositors; it does not make the trades any less risky.

## Try it in BuildTrade™

Open Track Record and find the deepest fall from a high in your own record, paper or live. The same reading works on a vault’s performance page: where it ended, and the worst stretch on the way.

Open the app: https://trade.buildtrade.app/register

## Words in this guide

- [Account equity](https://buildtrade.app/glossary/#account-equity)
- [Fee](https://buildtrade.app/glossary/#fees)
- [Liquidation](https://buildtrade.app/glossary/#liquidation)
- [Margin](https://buildtrade.app/glossary/#margin)
- [Slippage](https://buildtrade.app/glossary/#slippage)

## Sources

- [Vaults](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/vaults), Hyperliquid Docs.
- [For vault leaders (legacy)](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/vaults/for-vault-leaders-legacy), Hyperliquid Docs.
- [For vault depositors (legacy)](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/vaults/for-vault-depositors-legacy), Hyperliquid Docs.
- [Protocol vaults](https://hyperliquid.gitbook.io/hyperliquid-docs/hypercore/vaults/protocol-vaults), Hyperliquid Docs.

BuildTrade™ is independent of, and not endorsed by, Hyperliquid.

Web page: https://buildtrade.app/guides/how-vaults-work/