If you didn’t catch my introductory post explaining why I’m creating and tracking different Cryptocurrency Indices, check out my first post in Month 1. https://steemit.com/cryptocurrency/@maskedrider/cryptocurrency-index-investing-experiment
A quick recap, I’m using the top 10 coins in coingecko.com and starting out July 1, 2017 with $10,000 paper money into 3 different index strategies and track which performs the best.
Equal Weighting - This is the most straightforward way to allocate the 10 positions. Each receives an equal weight, $1,000 spread out over the 10 coins.
Market Cap - This allocation takes the total market cap of the top 10 coins, divides the individual market cap of each coin by the total and ranks the allocation accordingly.
Coin Gecko - This takes the Coin Gecko ranking and divides by the total rating of the 10 coins and allocations the portfolio.
October 2017 Recap
Bitcoin was the story of October, rising over $2,000 dollars over the month. The Market Cap weighting is the clear winner in October and is the clear winner of this experiment. Betting on Bitcoin and Etherem is just providing bigger, more stable returns at this point in Cryptocurrency. It won’t always be that way and that’s why we index.
IOTA dropped out of Coin Gecko’s Top 10 and was replaced by EOS. IOTA was liquidated out of the indices and all 3 indices were rebalanced.
Equal Weighting - finished October down to $10,437.20
Market Cap Allocation - finished October up to $18,957.26
Coin Gecko Allocation - finished October up to $12,576.45
The above graph tracks investments in the Equal Weighted Index, Market Weighted Index, Coin Gecko Weighted Index, CRIX index, BLX(Iconimi) and VOO(Vanguard S&P 500 ETF).
In October 2017, you would have had the greatest return by investing the Market Cap weighted index, or just bought Bitcoin.
As always, would enjoy any comments, questions or suggestions on how to improve this experiment and I look forward to further tracking these. Until next month.
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