This opportunity works well for investors who want long exposure to ETH, while diversifying risk across several variations of liquid staked ETH.
Risks include Yearn's smart contract risk and the quality of the collateral backing yETH. Yearn also controls a trusted address with access to whitelist new liquid staked assets.
Yield comes from several sources including the underlying staking rewards from each liquid staked ETH, whitelisting fees from new protocols interested in being included in yETH, and trading fees charged for swapping assets within the pool. Yearn also takes a 10% cut as a performance fee.