> For the complete documentation index, see [llms.txt](https://wp.isc.money/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://wp.isc.money/how-isc-works/the-isc-reserves/key-concepts.md).

# Key Concepts

#### **i. ISC Target Percentage Allocation** 

The ISC Target Percentage Allocation refers to the desired proportion of each asset class for the ISC Reserves, as decided by the community. 

*Example*

<table><thead><tr><th>Identifier</th><th>Asset</th><th>Allocation</th><th data-hidden></th><th data-hidden></th></tr></thead><tbody><tr><td>Asset 1</td><td>Equity, Global</td><td>20%</td><td></td><td></td></tr><tr><td>Asset 2</td><td>Commodity, Gold</td><td>20%</td><td></td><td></td></tr><tr><td>Asset 3</td><td>Bond, Global Bonds</td><td>20%</td><td></td><td></td></tr><tr><td>Asset 4</td><td>Bond, Short-term Treasuries</td><td>20%</td><td></td><td></td></tr><tr><td>Asset 5</td><td>Cash</td><td>20%</td><td></td><td></td></tr></tbody></table>

#### **ii. ISC Reserve Basket**

The ISC Reserve Basket is the precise quantities of each asset required for one (1) ISC at the present day (Tₙ).

*Example*

<table><thead><tr><th width="142">Identifier</th><th width="87">Asset</th><th>Weight</th><th data-hidden></th><th data-hidden></th></tr></thead><tbody><tr><td>Asset 1</td><td>VWRA</td><td>0.003060869565</td><td></td><td></td></tr><tr><td>Asset 2</td><td>SGLD</td><td>0.001717391304</td><td></td><td></td></tr><tr><td>Asset 3</td><td>AGGU</td><td>0.06000434783</td><td></td><td></td></tr><tr><td>Asset 4</td><td>IB01</td><td>0.002930434783</td><td></td><td></td></tr><tr><td>Asset 5</td><td>USD</td><td>0.3034869565</td><td></td><td></td></tr></tbody></table>

#### **iii. ISC Target Price**

The ISC Target Price is the total value of the ISC Reserve Basket at the present day (Tₙ), where p is the asset price, and q is the quantity of that asset.

$$
p\_{\text{isc}} = \sum p\_{\text{asset}} \times q\_{\text{asset}}
$$

*Example*

```
💲 $1.5304034913043478
```

#### **iv. ISC Reserve Basket Daily Rebalance**

The ISC Reserve Basket Daily Rebalance details the specific adjustments to the precise quantities of each asset in the ISC Reserve Basket, which will be implemented tomorrow (Tₙ₊₁) based on the closing ISC Target Price (Tₙ). The selected traded price will be the VWAP of Tₙ₊₁.

*Example*

<table><thead><tr><th width="119">Identifier</th><th width="87">Asset</th><th>Weight</th><th data-hidden></th><th data-hidden></th></tr></thead><tbody><tr><td>Asset 1</td><td>VWRA</td><td><mark style="color:red;">-0.0000007846547315</mark></td><td></td><td></td></tr><tr><td>Asset 2</td><td>SGLD</td><td><mark style="color:green;">0.000000209242236</mark></td><td></td><td></td></tr><tr><td>Asset 3</td><td>AGGU</td><td><mark style="color:green;">0.000008366956522</mark></td><td></td><td></td></tr><tr><td>Asset 4</td><td>IB01</td><td><mark style="color:red;">-0.00000005384615385</mark></td><td></td><td></td></tr><tr><td>Asset 5</td><td>USD</td><td><mark style="color:green;">0.000007182608696</mark></td><td></td><td></td></tr></tbody></table>