Hedged Automated Market Making (hAMM) is the liquidity solution for contract calculation, which is inspired by Automated Market Making (AMM).

However, margin trading is significantly different from spot trading.

Thus, the goal for hAMM is "position hedged", the formula is as follows:

Both hAMM and AMM take the same path to achieve their goal, i.e., each deviation and imbalance of the system caused by transactions would create reasonable arbitrage possibilities, which would attract external arbitrageurs to trade for risk-free profits, therefore restore the system back to a balanced state.