Consider the trading pair on Uniswap of DAI/ETH. The fixed tranche depositor will provide one asset, while the variable tranche depositor will provide the other. Let's say the fixed yield depositor provides DAI and the variable yield depositor provides ETH. They will deposit their assets into the Vault contract. A strategist will set a hurdle rate for the fixed yield. In this example, let's say it is 10% annualized. The vault will remain open for deposits for a short period, then it will close and the strategist will invest the assets into the AMM's liquidity pool. After some duration (say 4 weeks), the strategist will redeem the LP tokens for both assets. The vault contract will then use those assets to first pay back the fixed yield depositors their original principal plus yield, while the variable yield depositors will get any excess returns.