# Levered Exposure When a user opens a leveraged directional position: 1. The user's collateral is locked and, together with Underwriting Facility capital, funds the position construction on the underlying venue (i.e. Polymarket). 2. Dimes constructs and maintains the hedge for the duration of the position. 3. User PnL becomes a function of probability movement multiplied by leverage. 4. Hedge PnL offsets user PnL so that Dimes remains neutral within defined liquidation constraints. #### Hedge Mechanics For a long synthetic YES exposure, Multiply expresses the user position by acquiring the equivalent YES exposure on the underlying prediction market venue using facility capital. **The position produces gains or losses that mirror the user's PnL, keeping Dimes neutral to price direction.** If the position evolves favorably for the user: * the hedge pays out more than its acquisition cost, * the excess is transferred to the user as profit, * and the hedging facility recovers its original principal. If the position moves against the user: * the hedge pays out less than its acquisition cost, * the user's margin absorbs the loss through liquidation, * and the transferred loss restores the hedging facility's principal. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.dimes.fi/leverage-and-risk/synthetic-exposure.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.