It’s well known, that investment decisions of both experienced and novice investors are often far from optimal and often made on a basis of simple rules and heuristics. Most investors who discover different patterns in past price movements trades in suboptimal ways and do not diversify properly, which leads to big losses.
In order to obtain a picture of investment behavior that is as clear as possible, we designed an experiment that clearly draws a comparison between holding crypto in your investment portfolio or not; even between holding a bitcoin and collecting a diversified portfolio with a well-designed rebalancing process.
On May 28, 2020, Crypterium launched the portfolio investment experiment, widely spread across the traditional market to show that better diversification and rebalancing of the investment portfolio is directly connected to higher returns on both traditional and cryptocurrency markets.
We have compiled a list of the top-5 cryptocurrencies:
- Bitcoin (BTC),
- Ethereum (ETH),
- Ripple (XRP),
- Litecoin (LTC),
- Crypterium (CRPT)
The portfolio was valued at $10,000 with the following asset distribution: 50% BTC and 50% altcoins, divided by 12.5% share each.
Throughout the year, we monitored the performance of our portfolio and introduced changes in the structure described in our weekly daily analysis to prevent over-rebalancing and keep the portfolio from market fluctuations.
Each week we offered a short overview of the portfolio state, implemented the necessary changes, and evaluated the performance of the coins in the portfolio to clearly demonstrate that well-diversified investments help generate profits by lowering risk exposure.
We applied this financial investment concept to the cryptocurrency market, which results in over 500% profit, exceeding the annual growth of the first cryptocurrency. At its peak the value of our investment portfolio was amounted to $68,000, hitting 680% within less than a year.
Top-5 Investment Portfolio surpassed Bitcoin growth
You can see a comparison of a one-year holding of bitcoin against our top-5 investment portfolio with a stable rebalancing process each week.
A one-year investment experiment undoubtedly helped most of Crypterium’s customers understand more about long-term investment in the cryptocurrency market, as well as gained over 500% profit with the following guide through the basic rules of professional investing.
The final results clearly show that we have successfully built a diversified investment portfolio with a proven method of investing in cryptocurrency. Most traders who have followed the recommendations of our weekly investment portfolio report became fully convinced that a properly diversified investment portfolio has more chances to give the highest profit over a certain period of time.