> For the complete documentation index, see [llms.txt](https://docs.stabull.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.stabull.finance/amm/rebalancing.md).

# Rebalancing

### Rebalancing the pool (from Concepts)

A trader that is bringing the scarce asset  scarce asset gets a better price than oracle (bonus) and the Trader TAKING the scarce asset gets a worse price (slippage). This ensures there is always an arbitrage incentive to return the pool to balanced

<figure><img src="https://3912201459-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FqKBa92wmsQoWnuHOatYu%2Fuploads%2FYxasCIpJKUpv9MhMvMHm%2Fimage.png?alt=media&amp;token=73f36f67-0184-4f12-bb84-9c676611d9f2" alt=""><figcaption></figcaption></figure>

since the NZDS is scarce in pool = overprice \
and the USDC is abundant = underpriced

a trader is incentivized to rebalance the pool...

(1) there is an arbitrage profit to collect by adding (selling) his NZDS for USDC (buying).&#x20;

(2) as an LP he will benefit from a balanced pool due to increased swap volume and fees.