What is an index

An index is a recipe. It names between 2 and 20 tokens that trade on Robinhood Chain and gives each one a share of the whole, so the shares add up to everything. No single token may be more than 50% of the recipe.

When someone creates an index, their ETH buys those tokens in those proportions and puts them into a vault: a small program on the chain that holds the tokens and follows a few fixed rules. Nobody, including the creator and the people who run fractions.fi, can take tokens out of a vault. The only way anything leaves is when someone sells index tokens back to it.

Index tokens

Each vault creates exactly 1B index tokens (1,000,000,000), once, and keeps them. It hands some out whenever someone buys, and takes them back whenever someone sells. Holding index tokens means owning a proportional share of everything in the vault.

• The creator's own deposit buys the first tokens at the launch price, 0.000001 ETH each.
• Every later buy adds ETH to the vault (which buys more of the basket, in the same proportions) and releases index tokens at the current price.
• Every sell returns index tokens to the vault, which sells a matching slice of the basket and pays out ETH.

The recipe never changes

The tokens and their weights are fixed when the index is created. A creator who wants a different mix creates a new index; the old one keeps trading as it is. This is deliberate: you can read the recipe once and know what you own for as long as you hold it.

Who can make one

Anyone with a wallet and at least 0.003 ETH. The creator is not given a stack of tokens to sell: the whole supply starts in the vault, and a creator who wants a position buys it like everyone else, at the same price and the same fee. What the creator gets instead is a share of every trade, forever. See Fees.

What it is not

• It is not a fund with a manager. Nobody decides anything after creation.
• It is not a promise about price. The index is worth what its tokens are worth, minus nothing.
• It is not a loan or a lockup. You can sell any time the vault has tokens to sell.