From 85a7b58d5528a50b189a524724839abd893f9eab Mon Sep 17 00:00:00 2001
From: surbhi <surbhi.jhavar@gmail.com>
Date: Wed, 26 Nov 2025 12:47:03 -0400
Subject: [PATCH] abstracting out the slippage formula

---
 src/hooks/usePartyPool.ts | 33 +++++++++++++++++++++++++++------
 1 file changed, 27 insertions(+), 6 deletions(-)

diff --git a/src/hooks/usePartyPool.ts b/src/hooks/usePartyPool.ts
index 1781fe0..9e56906 100644
--- a/src/hooks/usePartyPool.ts
+++ b/src/hooks/usePartyPool.ts
@@ -11,6 +11,30 @@ import type { AvailableToken } from './usePartyPlanner';
 // Q96 constant for price calculations
 const Q96 = 1n << 96n;
 
+/**
+ * Calculate slippage percentage based on market price and actual swap execution price
+ * @param marketPrice The current market price from the pool (in Q64 format, already converted to decimal)
+ * @param swapOutputAmount The output amount from the swap
+ * @param swapInputAmount The input amount for the swap
+ * @param swapFee The fee charged for the swap
+ * @returns Slippage as a percentage (e.g., 5.5 means 5.5%)
+ */
+export function calculateSlippage(
+    marketPrice: number,
+    swapOutputAmount: bigint,
+    swapInputAmount: bigint,
+    swapFee: bigint
+): number {
+    // Calculate actual swap price with decimal correction
+    const swapPrice = Number(swapOutputAmount) / (Number(swapInputAmount) - Number(swapFee));
+
+    // Calculate slippage: 1 - (actualPrice / marketPrice)
+    const slippage = 1 - (swapPrice / marketPrice);
+
+    // Convert to percentage
+    return slippage * 100;
+}
+
 export interface SwapAmountResult {
     tokenAddress: `0x${string}`;
     tokenSymbol: string;
@@ -172,13 +196,10 @@ export function useSwapAmounts(
                                     }) as bigint;
 
                                     // Convert Q64 format to decimal (price = priceValue / 2^64)
-                                    const price = Number(priceInt128) / 2 ** 64;
+                                    const marketPrice = Number(priceInt128) / 2 ** 64;
 
-                                    // Calculate actual swap price with decimal correction
-                                    const swapPrice = Number(swapOutputAmount) / ((Number(swapInputAmount)) - Number(inFee));
-                                    // Calculate slippage: 1 - (actualPrice / marketPrice)
-                                    const slippage = 1 - (swapPrice / price);
-                                    calculatedSlippage = slippage * 100; // Convert to percentage
+                                    // Calculate slippage using the reusable function
+                                    calculatedSlippage = calculateSlippage(marketPrice, swapOutputAmount, swapInputAmount, inFee);
                                     console.log('calculatedSlippage', calculatedSlippage)
                                 } catch (slippageErr) {
                                     console.error(`Error calculating slippage for ${token.symbol}:`, slippageErr);