There are now over 5,000 cryptocurrencies to choose from and that comes with choice paralyzes, complexities, need for advice and high risk without considering the high volatility. Besides, as a person can make errors when determining and analyzing trends, which means crypto indexes based on AI, big data and neural networks in calculating the indexes and doing the re-balancing, are more accurate in determining what to invest in.
Index funds have low fees compared to actively managed funds and therefore tend to be preferred by many. They basically derive from stock index funds such as the S&P 500 index which is comprised of the largest companies publicly traded on the stock market.
Crypto traded indices basically are baskets with different digital assets combinations whose weighing composition is determined for each of the coins before inclusion into the indices. So a company may then utilize the fund to buy those tokens and trade in the market and constantly update on the value of its’ portfolio. The list is then reviewed constantly either manually or by software in order to determine if those coins should continue to list in the index or others with more weight should come on board.
Most of these indices are tokenized to allow a secondary market where the company offers the token to investors to buy "shares" into the fund, and the price of the CTI token is kept as close as possible to the index value. In other cases, a company may allow an investor to choose their own preferred coins/tokens to form a portfolio to invest in. And although you may find security token-based crypto indices where the token and issuance is regulated, most of the tokenized indices and funds work on the basis that ERC20 tokens are just utility tokens. Basically, they act as an investment vehicle in crypto economy and are more preferable for people who want to diversify their crypto portfolios instead of holding one type of asset.
So here is a list of the different crypto indexes and index funds I came across when searching. As you might have known already, some indices are solely for informational purposes but most or all of those in this list offer the investment option where you can invest money via token in those index funds.
Crypto20 is a tokenized crypto index fund that tracks the performance of the top 20 cryptocurrencies/tokens in market capitalization. It has a token known as C20, which is a ERC20 utility token whose holders get rewards based on their share of or to the portfolio or amount of tokens as the index fund or held digital assets grow. The crypto fund maintains a diverse portfolio of these top 20 tokens just as Vanguard 500 maintains a portfolio of shares of top 500 publicly listed US companies based on their market capitalization.
The C20 token can also be liquidated through the C20 smart contract. The index management does a weekly review of their balance sheet. The maximum weight of the elements on the index is 10%. It has an annual fee of only 0.5%, which is much better compared to competing indices that have fees of over 3%. The fund, whose current value is $16 million, is independent and automated meaning it makes use of algorithms that can act to market movements with minimal human intervention.
TheCryptoCoinIndex has three cryptocurrency indexes, namely the CCI10, CCI25 AND CCI50 each of which tracks the said number of cryptocurrencies/altcoins. According to their website, the value of the CCI10 Index share is $91.98; CCI25 Index is $93.79 and CCI50 Index $93.77.
It looks like this one is for information purposes and not yet launched the investment option.
Lykke Crypto Index
Lykke Crypto Index is a weighted index that tracks performance of 25 cryptocurrencies with the largest market capitalization while ignoring stablecoins. The weight determines the percentage of contribution of a certain single crypto to the index, with BTC having obviously over 57% contribution. The index revises the underlying assers at regular predefined intervals to capture movements in the total market cap of all assets in the marketplace, with LyCI being reconstituted on this basis.
They started as an index for information purposes without the investment opportunity but now there is an investment option for those interested.
Amun Crypto Basket Index (HODL5)
Amun crypto basket index (HODL5) tracks performance of top 5 and most liquid crypto assets, weighing them based on 2050 market cap and re-balancing monthly to ensure that an accurate representation of the current crypto market. These assets cover over 75% of market in market cap. They do not include tokens that are anonymous, e.g. Monero and zCash, cryptocurrencies that lack sufficient liquidity; those crypto that trade on non-reputable exchanges and those that have not been traded for 6 months in the minimum.
According to their website, the index fund has grown 1190% since inception. They use volatility management methodology to ensure that they protect investors against the ups and downs of the broader crypto market. As per their back-tested data since January 1, they say that the crypto basket beat Bitcoin BTC by 3.91 times.
The index has an investment option for those willing and returns an average daily of 0.44% compared to Bitcoin's 0.27% and an annualized Sharpe Ratio of 4.29% compared to Bitcoin's ratio of 1.98%.
Isonex Capital is also a tokenized crypto index fund that invests in top 15 coins and holders are able to buy into the fund through a single token called IX15.
Isonex Capital utilizes a Equal Weight strategy to determine the weight of each of the coin in the index fund. The strategy gives the same weight to each of the coins in the index fund. The tool, which is in beta, tracks 15 top cryptocurrencies and is a successful formula that buys low and sells high while keeping an equal holding across the top 15 coins.
Hence it adheres to fundamental rules of successful long term investing. The2 strategy, according to the company's website, this strategy has outperformed other strategies such as the use of market cap over 57% of the one year periods, on a rolling monthly basis since the funds started. Moreover the funds outperformed over 84% of the five year periods and 100% of the ten year periods.
The index is re-balanced every day, and it means whatever happens to any crypto, holders will always hold the top 15 upon each rebalancing.
The token sale will start in May.
CRIX index was launched in 2016 by the University of Management of Singapore together with Ladislaus von Bortkiewicz from the Department of Statistics at the University of Humboldt in Berlin. It uses a market-weighted average system to track performance of 20 cryptocurrencies chosen by market capitalization, and having their weights calculated in real time.
The methodological basis for calculation is available on their website.
Hold10 Index was launched by Bitwise Asset Management in 2017 and it is a managed index fund of 10 cryptocurrencies, and takes into account the market capitalization of cryptocurrencies that are included in the list. The coin included should be traded on several exchanges, and the trading volume should exceed 30% of the offer within the last three months. Besides, the asset included must have a free-floating rate and not be tied to another asset.
The tokens included are further adjusted for inflation of market capitalization given the supply schedules for the next five years. Revision of the list of coins takes place on a monthly basis. The investors to the fund are paid rewards based on performance of the fund.
Bit10 provides exposure to the 10 coins in the Index with a total market capitalization of $98B or over 80% of entire crypto market cap. Investors can buy into the tokenized fund for as little as $5 minimum investment and can withdraw/deposit at any time.
They also have a mobile app that allows users to track value on the go.
CryptoIndex.io includes top 100 performing cryptocurrencies in 1 index coin that is also tradeable on crypto market or cryptocurrency exchanges. The index is based on AI and according to their website, utilizes other techs including top-tech Machine Learning and Big Data technologies and Neural Networks. This technology combination is used to evaluate and select the desired top 100 performing coins as per the algos, as well as to re-balance the index on a continuous monthly basis. Re-balancing is achieved by a highly sophisticated neural network algorithm called Zorax. The tech is used to analyze coins and their trading signals associated with them.
CryptoIndex, according to their website, replace a team of top 1000 analysts by monitoring all market trades and more than 1,000,000 signals per day for the top 1500 coins/altcoins. They pass the signal data through a series of factors and interpret them into forecasts and take into account that data when doing the re-balancing. It achieves a potential accuracy of up to 82%. 20% of the profit generated from the platform is distributed to users via Quarterly Loyalty Function.
The website also says that the index has performed 80% better than the market as a whole since May 17.
HB10 Index was introduced by Huobi cryptocurrency exchange in May of 2018 and was later listed on TradingView, which is a major go-to financial data and analysis platform for high volume and API traders. The HB10 was launched last year via the Huobi Pro platform and tracks performance of 10 cryptocurrencies/altcoins as per their marketcaps.
Ideally, it helps users to attain exposure to digital assets markets with a relatively small capital outlay and also provides users with greater diversification across constituent coin trading pairs. TradingView also added all Huobi's coin-to-coin trading pairs, meaning customers can engage in arbitrage and other forms of trading.
The index is rebalanced based on the constituent coin trading pairs and weight changes. Users were able to subscribe to HB10 shares with USDT, BTC, ETH or HT with the minimum subscription being 100 USDT, 0.01 BTC, 0.2 ETH or 50 HT for each account and the maximum investment value was set at 10 million USDT.
AltDex 100 Index
AltDex 100 Index was launched in by the cryptocurrency index platform AltDex and benchmarks top 100 cryptocurrencies and tokens without including stablecoins. Further, the cryptocurrencies or altcoins included must have a trailing 30-day average daily trading volume higher than $100,000. The cryptocurrency to be listed should also have a trading history of 1 month or greater and have a circulating supply of more than 5%.
Like all of the rest indices from the platform, namely AltDex Exchange Token Index (ALTEXC), AltDex Privacy Coin Index (ALTPRV), and AltDex Masternode Index (ALTMSN), it is rebalanced on the first of each month to fit the ever-evolving crypto markets. The AltDex indices went live on July 9 2018. The criteria of rebalancing was developed at the launch of AltDex.
The AltDex Exchange token Index (ALTEXC) tracks industry's leading crypto tokens and includes 23 crypto/altcoins with a market capitalization greater than $5 million.
The AltDex Privacy Coin Index (ALTPRV) tracks cryptocurrencies and tokens focused on privacy and security such as Monero with the number set at 17 crypto/altcoins/tokens each of which must have a market capitalization greater than $5 million. The February return for this was 11.65%.
The AltDex Masternode Index (ALTMSN) tracks cryptocurrencies that leverage masternodes to support network functionality without hyperinflation. the number of crypto/altcoins is set at 14 and each of which should have a market capitalization greater than $5 million. The February return is 17.21%.
Bit20 crypto index fund includes 20 of the largest cryptocurrencies in the market based on their capitalization, with exception of Ripple and is represented in the form of a smart coin based on the Bitshares financial platform. The index is calculated every month on 21st when a new algorithm is calculated including new positions and recalculating the ratio of existing ones.
CAMCrypto30 is issued by the Crypto Asset Management fund of Tim Enneking, is based on the 30 largest cryptocurrencies by market capitalization, and uses the same ideas as the Russel 2000 and FTSE 100 stock indexes. The index is balanced on a monthly basis to account for price fluctuations in a basket of crypto assets and their prices are calculated every 5 minutes. Third party sites can also use the embedded widget to allow tracking of data online.
CCI30 was launched in October 2017 by a team led by Igor Rivin, who was a professor of mathematics at Temple University and royal professor of mathematics at the University of St. Andrews, as well Carlo Shevola, a specialist in legal and financial consulting services and Robert Davis, an engineer, IT expert and programmer. Basically, it offers a tool for passive investors to participate in this asset class, and as an industry benchmark for investment managers.
The index includes top 30 cryptocurrencies with largest market capitalization and each of these assets is also weighed or assigned a weight. They chose 30 because it is the number necessary to be statistically significant or a statistically significant representation for the entire crypto market. Using that number means the index reflects a very high percentage of the cryptocurrency market capitalization. Using more constituents would mean higher fees without necessarily having to improve on performance. Choosing lower than 30 would mean reduced performance, insufficient diversification, compromised statistical significance and missed opportunities to pick the next rising star.
The recalculation of the index components takes place every quarter of the year while the weight of the components is calculated every month. The index features a balanced portfolio that maximizes profits and minimizes risk and volatility. The year to date change according to their website is 13% and month to date change is 9.30%.
ICEX Top10 index is developed in 2017 by a team from Russia and CIS countries. It includes equal shares of the 10 largest crypto by market capitalization and liquidity. Besides that, a cryptocurrency to be included in the index should not have a capitalization of not less than $500 million and average total daily trading volume must be at least $10 million in the last seven days. Also, the coin sales should be carried out in five or more cryptocurrency exchanges or exchange platforms.
The value of the index changes with each new transaction and each coin in the index has own separate calculated index.
DeCenter DCI and DC150 cryptocurrency and token indices follow the same strategies of stock indices. The DCI includes 10 cryptocurrencies and tokens according to capitalization while DC150 includes 50 of the top tokens as per capitalization for the previous 90 day period.
The initial value of each index was $1000 converted into Bitcoin and divided equally between 10 and 50 coins respectively. The value of DCI50 currently is 21 621.77 USD according to their website while DCI is 9 989.35 USD
CMC Crypto 200 and BTC Index ex Bitcoin (CMC200EX)
CoinMarketCap announced this week they will be launching two benchmark cryptocurrency indices on the Nasdaq Global Index Data Service, Bloomberg Terminal, Thomson Reuters Eikon and Borse Stuttgart and the two will be calculated and administered by German index provider Solactive. The two will cover the top 200 cryptocurrencies by market capitalization according to the announcement and one will have Bitcoin and one without it.
The one without Bitcoin on it will be called CMC Crypto 200 ex BTC Index (CMC200EX), while the one including Bitcoin is called CMC Crypto 200 Index (CMC200). The one without Bitcoin will reflect the market for the rest of cryptocurrencies/altcoins considering that Bitcoin is responsible for half of market cap for all cryptocurrencies. The two will be re-balanced on the last day of each calendar quarter.
Solactive is the company behind the CBOE Bitcoin Futures index that was launched in December 2017 and now administers over three thousand custom indices.
Bitmain Crypto Index
Bitmain launched a crypto index last year August as a benchmark for investors. The crytpo index tracks tracks performance of some of the largest and most liquid cryptocurrencies that denominated in U.S. dollars.
It will publish two types of prices -- a real-time spot price updated every seconds and a daily reference price that is published once a day around 10.00 a.m. Hong Kong time. It will also list spot prices on 17 top cryptocurrencies on marketcap as well as combined Bitmain Big 10. The Big 10 is weighted by market cap and is and its member crypto represents more than 90 % of crypto market value.
The index will provide investors with a transparent, timely methodology-based and investable benchmark of the most active cryptocurrencie2s traded globally according to Bitmain. It also sources price data from a variety of cryptocurrency exchanges including GDAX, Binance, Gemini Huobi, Okex, Kraken, Itbit, and Itstamp. These exchanges were selected based on a variety of factors including reputation, price transparency, compliance levels, stability and trading volume.
Hedge Platform CTIs
Hedge Platform announced CTIs that started trading on the platform in the Q1 of 2018.
The Bloomberg Galaxy Crypto Index
The Bloomberg Galaxy Crypto Index was started on May 3, 2018 and tracks performance of the top 12 cryptocurrencies as per weighted market cap for each.
This means those with higher market cap have a higher weight. The included must also trade against the dollar. It also cover other various facets of cryptocurrency that include mediums of storage of monetary value and mediums of value exchange, smart contract protocols (Ethereum), and privacy-focused digital assets.
The index is re-balanced and reconstituted monthly and each constituent weight is between a maximum of 30% and a minimum of 1%. It started with a base value of 1000.
Circle Invest allows investors to buy 12 different cryptocurrencies in a single investment. It works on Android and iOS mobile app and with the app, a user can set up recurring buys so as to dollar cost average into their crypto portfolio. The investment can be as low as a dollar. The difference with this one from those in the list is that it allows an investor to collect their coins of their wish when buying or bundling.
Coinbase Bundle lets investors invest in the first 5 cryptocurrencies listed on Coinbase and these are weighted by market cap at the time of buying.
Bitcoin contributes 75.59%, Ethereum 15.84%, Litecoin 3.94% and Bitcoin Cash 3.11% while Ethereum Classic contributes 0.52%.