We are using an external 5V VCO with AD9517. According to the manual, VCP should be tied oto 5V.
But the output of VCO is attenuated to within 3V range, is it necessary to connect 5V to VCP?
Your tuning voltage is limited by the supply voltage at VCP (Max Vtune= VCP-0.5). If you plan to operate your external VCO at a frequency that complies to this, it is possible to use a lower VCP. You must understand that the voltage applied to Vtune will never be greater than VCP-0.5 and you are also going through a loop filter, causing further attenuation, before reaching your VCO's Vtune pin.
Keep in mind that the tuning voltage required to keep your VCO at the frequency of interest will vary with temperature.
In summary, it is possible to use VCP=3.3V for your 5V VCO but there is risk involved. Please let me know if you have any other questions
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