2019 has come with some changes, some good and others harder to figure out and adjust to. We have had to reflect, look back at our performance over the past year and adjust our aims and goals accordingly. There have also been some adjustments and changes made to timelines and team roles, these adjustments are all in spirit of product, team, investor, business and overall success. Sharpe’s focus over 2019 boils down to our two core competencies, High Frequency Trading, and developing the World’s foremost global market sentiment & analytics platform. Accordingly, we have diverted the vast majority of our resources to these enterprises, and we’re providing some insight into our progress in these key areas today.
HFT development has been focused on two key areas. Firstly, we have been focused on the development of a robust framework for continual improvement of automated trading strategies, including building state-of-the-art backtesting software capable of simulating tick-resolution price action at the order-book level. Secondly, we have been expanding our capability to deploy HFT strategies on as many markets as possible. This includes both technological expansion to ‘plug in’ to every necessary exchange platform, but also from a business development perspective, meeting with key figures at large exchanges with good liquidity, in order to secure preferential terms in exchange for providing much needed liquidity on their markets.
Many Sharpe supporters will recall seeing preliminary results from the first iteration of Sharpe’s HFT several months ago. Whilst we saw encouraging returns, there were fundamental issues associated with inventory risk — a well-known problem in equity markets, which are magnified tenfold in relatively illiquid cryptocurrency markets. It has taken a lot of hard work and dedication from our development and data science team to mitigate these issues, but we finally have developed hedging strategies enabling us to generate consistent monthly returns on a fiat basis.
The figure above shows 2 weeks performance without leverage. The illustrated strategy is entirely market neutral, and live tests over the past quarter suggest it can comfortably return 5% per month (on a fiat basis), with an excellent risk profile thanks to dynamic hedging of BTC inventory. We plan to gradually ramp up exposure over the coming quarter, and are continuing to explore additional markets with which we can integrate.
Global Sentiment Index
The Global Sentiment Index is currently in development, our design and analyst teams are working together to understand how to deliver actionable market insight both to retail and institutional investors — ranging from API development to designing slick, easy-to-use web and mobile applications. We are conducting market research to determine optimal pricing strategies to ensure GSI users receive great value for money, with tiered access levels to suit every investors’ needs. There are a number of intricate details and projects that need to be completed and finalised before we can launch the finished product, when dealing with millions of data points across global equity markets, analytic methodologies, design elements. We now have prototype designs for mobile and web releases of the GSI, and we look forward to sharing more of these as they begin to mature.
As a quick recap, our Global Sentiment Index is a collection of prediction data from our Centuri platform. Prediction data from our users will be packaged into a GSI and licensed to institutional investors. As mentioned in our marketing, Centuri users will gain preferential access to the data that they have helped Sharpe generate.
The Sharpe Fund’s seed portfolio has been performing well, with the teams we invested in making fantastic progress in improving liquidity and mainstream adoption of blockchain-enabled technologies. With regard to our equity portfolio, we have held a market neutral (fully hedged) position for the previous quarter and are in a process of gradual de-levering, as this capital can be better deployed to HFT with a better risk/reward profile. Active equities portfolio management is a time consuming process and we prefer to focus our goals and time on generating long-term sustainable income. Accordingly, we will no longer be providing weekly updates of the Sharpe proprietary fund NAV. We will provide NAV updates at a frequency that we deem appropriate based on reappraisals of our seed investments and the progress of our other trading activities.
The Centuri iOS mobile application is currently in internal beta testing, and we are preparing to launch to the App Store soon. We cannot commit to a precise date as we are subject to Apple’s submission and review process. Centuri users will continue to receive monthly Service Fee payments for providing their market insights on equity and crypto markets, and discretionary quarterly payments when we deem it sustainable to do so.
Sharpe Customer Service and Community Announcements
We have come to the conclusion that maintaining a public telegram group is not conducive to the continued development of a successful business, as we progress from an early stage start-up. The number of regular participants within the Sharpe telegram group is very low, a tiny fraction of the number of weekly active users, and it certainly does not warrant the resources currently committed to maintaining it. Accordingly, we will be closing the group with immediate effect, and moving to an announcement only model. Users in need of customer support may contact firstname.lastname@example.org and one of the core team will be more than happy to help you solve any issues that may arise. We will publish updates in a timely manner on Sharpe’s progress regarding the development of Centuri and the GSI, and seek user feedback through surveys as we continue to make refinements and optimise how we collect, process, analyse and present market sentiment data.
We would like to take this opportunity to thank AmaZix for their consistent effort and dedication to our Telegram channel. AmaZix have been brilliant in answering all your questions and have kept us in the loop with any concerns and questions from our community. AmaZix not only managed our channel but also took a genuine interest in Sharpe and the growth of our business. Sharpe is grateful to the AmaZix team for all the time and effort spent managing our community and Telegram channel.
Talk to the Team
The best place to reach out to the Sharpe team is through Telegram, at email@example.com.
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