MONTHLY INDEX ALLOCATION
Previously I have announced that I wanted to make my premium service a complete package, something for every kind of trader. Most of the world’s traders are passive investors. Passive investing is also a possibility for crypto, but you need to know where to invest in. With my monthly index allocation, I want to provide a care-free trading opportunity for all types of traders.
A passive investor might choose to invest all of his trading capital into an index, make a couple of trades at the start of the month and enjoy the ride carefree. For more active investors, putting a part of your capital in a crypto index might be beneficial because you can ride bullish periods longer without feeling the urge to “time the market”, whilst still making competitive profits. All-in-all, passive investing is a carefree way of investing which often will out-perform most active investors on the market.
Below you find the chart of my back-tested index. Backtest is based on monthly open/close candles to calculate the asset values. Backtest has started in January 2019 because a lot of important crypto’s are missing before that time.
As of 31-05-2021, the total gain of this index is 5,000% over a period of 28 months, an amazing return for almost zero work! The results are multiplied with each other because the idea of the index is that every month the total value gets reinvested in the new index.
No new trades will be made during bearish periods. Bearish periods are marked by the straight horizontal line on the chart below.
The best way to make great returns is to make an additional monthly investment into the index. My advice would be 10% of your balance and let it compound.
How it works:
The algorithm suggests a certain allocation and tokens to invest in. In month X the allocation could be 50% ETH and 50% ADA. You start this "trade" at the start of the month and exit in the end. This is a manual trade which you have to take yourself in case you wish to participate.