A Quick Guide to Sharpe Capital
Sharpe Capital is a multifaceted investment company that integrates several proprietary strategies to trade on government regulated stock exchanges. Its initial index fund will be using a long/short strategy by buying long assets while simultaneously short selling those that are expected to decrease in value. It will do this through their Quantitative Trading Model which utilizes several proprietary market assessment strategies.
What is Their Quantitative Trading Model?
Sharpe Capital believe traders take positions based on an assets speculated price. Instead of placing orders based on the intrinsic value of the asset, they base it off of the price they believe it will reach in the short term. Contributive factors may include news, emotional reactions to market movements, and even Technical Analysis. Therefore, investor sentiment is an enormously influential factor in market performance. Recognizing this, Sharpe Capital created the Quantitative Trading Model which will capitalize on these market sentiments while also factoring in microeconomic principles. This integrative model can be broken down into 4 basic components:
- Machine Learning
- Linguistic analysis
- Crowd-Sourced Sentiment
- Consistency Analysis
1. Machine Learning (ML)
ML is a proprietary program that continually improves its algorithm to recognize and classify market patterns. It seeks to forecast asset price performance based on underlying economic indicators and machine learning linguistic analysis to predict investor sentiment.
2. Linguistic Analysis
Sharpe Capital has also created aanother proprietary program that integrates cognitive behavioral science, psychology, and decision theory into analyzing real-time data feeds taken from social media and news.
3. Crowd Sourced Sentiment
Crowd sourced market sentiment will be obtained through the Sharpe Capital sentiment platform. Sharpe Capital will first create a cryptocurrency token called a Sharp Utility Token (SHP) which people can obtain via exchanges or through their ICO. SHP holders will then be able to provide opinions/sentiment on news provided through their platform.
4. Consistency Analysis
Finally, Sharpe Capital will assess all three of these sources to create a Consistency Analysis which will inform their A.I. Portfolio Manager. This portfolio will provide a list of highly accurate list of future price predictions for thousands of assets over multiple timezones.
What Exactly is SHP?
SHP is a token that can be obtained via cryptocurrency exchanges or through their ICO. It will serve several functions in Sharpe Capital’s platform:
- Hedge Funds and institutional investors will be able to access information within Sharpe Capital’s Quantitative Trading Model through SHP fees.
- SHP holders can participate in governance for Sharpe Capital. Any SHP holder will be able to make a motion and other SHP holder can vote on it. The motion must obtain a simple majority for it to pass. Below is an example of what this might look like on their platform.
- SHP holders will also be able to earn rewards by voting on bullish versus bearish sentiment of an asset on the Sharpe Capital sentiment platform. Payouts will take into consideration the amount of SHP and the sentiment reputation of the individual. These will be paid out in Ethereum. Holders will not lose SHP if they choose incorrectly.
- SHP holders are also entitled to Sharpe Crypto Derivatives (SCDs). SCD will be another cryptocurrency token that will be tied to Sharpe Capital’s proprietary investment fund. SCD holders will also be able fund the creation of their baskets that reflect different risk profiles and asset classes. They will send their SCD into a smart contract to create a new token tied to their new basket. SCDs will have bi-annual Ethereum payouts and will be distributed 1:1 with SHP at a later date. Here’s what their cryptocurrency wallet will look like on their platform.
Sharpe Capital Financial Markets Protocol
Probably the most unique aspect of Sharpe Capital is their Financial Markets Protocol which is a Trustless Ledger System (TLS) based on the SHP blockchain. Sharpe Capital will log the following information into the SHP’s blockchain:
- Open Price
- Stop Price
- Limit Price
- Ticker Symbol
- Stock Exchange Symbol
The blockchain technology permits any institution to be instantly audited by any member of the public or regulatory body. This means any individual can view all of Sharpe Capital’s previous trades and fund performance with absolute confidence. This eliminates any dependency on trust for fund disbursement and any possibility of fund manipulation at an institutional or individual level.
The Financial Market Protocol will also be available for anyone or any institution who wishes to implement a trustless investment fund to protect against rogue activity and win confidence from investors. By offering this service, Sharpe Capital hopes to eliminate corruption in global financial markets while still protecting individual corporation’s proprietary information.
Details of Sharpe Capital’s ICO
- 2,000 SHP tokens will be distributed for 1 ETH.
- ETH USD rate will be locked in by Oct. 9, 2017
- For each 2,000 SHP issued, an additional 2,000 SHP will be held in reserve for future fundraising and an additional 1,000 will be distributed to Sharpe Capital founders and community members for future platform development for a total distribution of 5,000 SHP for 1 ETH.
- Their target will be $60 Million.
- Their pre-sale will start Monday, October 9, 2017 at 14:00 BST (GMT+1) with a minimum of $10,000 buy in. You can sign up here.
- Here is a graphic of how the funds will be used: