# Principal-Protection

When N-Vault goes live, the majority of the initial deposit, determined by the PT price, is allocated to Pendle Finance (Fixed-Yield Source), while the remaining portion, equal to (1 - PT Price)%, is deployed in the options strategy.

At maturity, the PT allocation earns enough yield to fully cover the initial deposit, ensuring 100% principal-protection. At the same time, the options strategy offers the potential for boosted yield depending on the performance of the underlying asset at maturity.

<figure><img src="https://3592879-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FycCgi8Q2btDJLeSgNa6m%2Fuploads%2FCM52OSK1qA8YfhrIe4v5%2FFlowcharts%20for%20litepaper%20(20).png?alt=media&#x26;token=18b3a674-ba12-4ebf-a700-e743c7ee04b9" alt=""><figcaption><p>100% Principal-Protection</p></figcaption></figure>