Crypto Momentum Fund
A market-cap weighted fund that seeks to rebalance into the top performers in the cryptocurrency market.
Fund
498.83%
vs
Benchmark
99.15%
*Vertical reference line denotes the end of simulated backtest data and the start of live performance data.
** Performance data is calculated using the average returns of all accounts with more than $100 invested in this strategy.
Fund Holdings
Fund details
Stats
4.02/5
Risk score
Max draw down (of range)
Daily Sharpe (of range)
Daily Volatility (of range)
Monthly Volatility (of range)
25.00%
Correlation to S&P (total)
Description
In order to give more than insignificant coverage to smaller coins, this is not a purely market-cap weighted portfolio, but rather overweights smaller coins' exposure and underweights larger coins like Bitcoin. In order to reduce volatility and the need for extremely frequent rebalancing, this fund's take on momentum doesn't look at price action, but rather at market cap as a percentage of the total portfolio's market cap with the momentum portion coming from the frequent rebalancing strategy.
Key Considerations
A crypto index essentially follows the venture capital model - take many bets on the expectation that, even in the case of most bets going to zero, the winner makes up the difference multi-fold
We see crypto as an asset class whose risk profile lies (and oscillates) between mid-cap equities and early stage VC - this risk profile shows up in the volatility this asset class displays in a short time period
A pure momentum-based crypto portfolio would need to rebalance multiple times a day in a volatile crypto market, and would be more susceptible to investing at the top in a bear market.
There is a steep drop-off in the market cap of coins after the top few, and thus a drop-off in media coverage and accountability. A market-cap weighted portfolio does not take into account project legitimacy or other metrics. This strategy invests in fractional shares when available. When not available, it will invest in the nearest (lower) whole number of shares. Please note that this number may be 0 if your investment in this strategy is sufficiently low, meaning our investment strategy advertised returns will be different from your returns.