# Tracking Pendle PT and YT Positions Correctly

> Pendle splits a yield-bearing asset into principal and yield tokens with different valuation curves. Pricing either at spot gives the wrong number.

- **URL:** https://octav.fi/blog/tracking-pendle-pt-yt-positions
- **Published:** 2026-02-18
- **Author:** Octav Team — Portfolio Intelligence for Digital Assets
- **Topic:** Protocols
- **Tags:** pendle, yield, defi
- **Source:** Octav, Practical guides on crypto NAV reporting, multi-chain portfolio management and digital asset APIs, from the team behind Octav.

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<LogoRow items="pendle,ethereum" caption="Protocols covered" />

Pendle is the position type that breaks naive portfolio tracking most cleanly,
because it deliberately separates an asset into two instruments whose values
move in opposite directions as time passes.

## What Pendle does

Deposit a yield-bearing asset and Pendle splits it into two tokens with a fixed
maturity date:

| Token | What it is | Value at maturity |
| --- | --- | --- |
| **PT** (Principal Token) | A claim on the underlying at maturity | Converges to par — 1:1 with the underlying |
| **YT** (Yield Token) | A claim on the yield until maturity | Goes to **zero** |

Before maturity, PT trades at a discount to par. That discount *is* the implied
fixed yield: buying PT at 0.94 and holding to maturity for 1.00 is the fixed-rate
trade Pendle exists to enable.

YT does the inverse. It accrues the underlying's yield over the remaining term,
and on the maturity date it is worth nothing at all.

## Why spot pricing gets it wrong

Both directions of error are common:

**PT priced at par** overstates the position. A PT maturing in nine months is
not worth its face value today; the whole point is that it is not.

**YT priced as a normal token** misses that its value decays deterministically
to zero. A YT position marked at last trade, with no model of time to maturity,
drifts further from reality every day — and unlike a market loss, this decay is
known in advance.

Correct valuation needs three inputs a balance query does not have: the
maturity date, the current implied yield, and time remaining.

## The third position type

Pendle also has LP positions, which are a pool of PT against the underlying.
Valuing one requires resolving the pool share into its components and then
valuing the PT leg properly — so an LP position inherits every complication
above, plus the pool-composition problem described in
[Valuing Uniswap V3 Concentrated Liquidity](/valuing-uniswap-v3-positions).

| Position | What decoding requires |
| --- | --- |
| PT | Maturity, discount curve |
| YT | Accrued yield, time decay to zero |
| LP | Pool composition, plus PT valuation |

## What this means for reporting

For a fund holding Pendle, two consequences follow directly:

**Mark-to-market needs a term structure.** Fixed-income instruments cannot be
marked from a spot price alone, and PT is a fixed-income instrument wearing an
ERC-20 interface.

**Maturity dates are a reporting event.** A PT position converts to the
underlying at maturity. A portfolio system unaware of maturity dates will show a
position that silently changes character on a known future date.

## Checking a provider on Pendle

Take a wallet with an open PT position and ask:

- Is the PT valued at a discount, or at par?
- Does the response expose the maturity date?
- Is a YT position present at all, and does its value decline as maturity
  approaches?
- Are LP positions resolved into PT plus underlying, or shown as an opaque LP
  token?

A provider that prices PT at par is not wrong by a rounding error — it is
reporting a fixed-income instrument as if the fixed income were free. For the
broader pattern, see
[Why Portfolio APIs Disagree About Net Worth](/why-portfolio-apis-disagree).