10 Best Crypto Index Funds
By Roman Wiligut on The Capital
The development of the cryptocurrency market attracts many institutional investors. Because the market is still relatively young, then for their usual understanding of the market sentiment, professional tools are needed — cryptocurrency indices and cryptocurrency index funds.
Firstly, let’s figure out what is a cryptocurrency index funds? How do they work?
What are Crypto Index Funds?
In the usual sense, an index is a digital expression of a certain portfolio of assets that shows the mood of the market, and index funds follow it or immediately buy an index. The index itself is built on various factors, such as capitalization, asset price, popularity, etc. The most famous classic market indices are Nasdaq, S&P500 and the Dow Jones Index (one of the very first to come to the market).
Crypto Index Fund Benefits
For beginners and professionals, indexes are a great way to save energy and nerves, as well as with proper use, an excellent way to increase capital and its diversification.
In the traditional stock market, indices are considered the best strategies👇
“With Index, the know-nothing investors can actually outperform most investment professionals”. — Warren Baffet.
With the help of cryptocurrency funds, you can legally invest in cryptocurrency indices, thereby diversifying risks.
Recently, there has been an increase in interest in cryptocurrency funds from institutional investors. Such crypto index funds as:
1.CIX.Fund — $11 000 000 raised.
This fund tracks the AI-Based cryptocurrency index called CIX100. Fund based in Luxemburg and it offers tokens CIX100 with buy-back option and it follows to CIX100 token value. Token consist the best 100 tokens chosen by AI.
CryptoIndex with the help of an AI-based algorithm is continuously analyzing more than 2000 coins applying over 200 factors, processing more than 1 million signals per second to provide a highly sophisticated index of the top 100 coins.
CIX100 has the following distinctive features:
• Auto purchase. CIX100 is equal to a current portfolio value of TOP 100 coins.
• It performs automatic portfolio rebalancing every month.
• Transparency — you can track all transactions and underlying assets of the CIX100 token in real-time on the blockchain.
• Investing 3 percent into CIX100 while keeping 97 percent in cash outperforms investing 100 percent into stock markets.
• With the help of our prediction algorithm, which reaches 98% accuracy, our tool is suitable for long-term investors and traders.
The project also plans to launch other CIX50, CIX25, and CIX15 indices based on Artificial Intelligence
P.S The key feature of this project is that this index is not based solely on crypto market capitalization.
2. The Invictus Hyperion Fund — $10 000 000 raises.
This fund also tracks its own C10 index. In many ways, it repeats the strategy of previous funds and is based on the capitalization of cryptocurrencies.
One of the founders of the fund is also the founder of Crypto20 — Daniel Schwartzkopff and apparently is the second project of the Crypto 20 team.
P.S Fund is also engaged in blockchain, real estate, and high technology.
3.Crypto 20 — $5 000 000 raised.
It is an autonomous token-as-a-fund allowing you to invest in cryptocurrencies like bitcoin and ethereum in a diversified index fund.
The CRYPTО20 fund monitors the capitalization of the cryptocurrency market and only the largest 20 are selected from all coins; the formed portfolio is periodically reviewed: assets that have lost popularity are removed, and new ones are added in their place.
CRYPTО20 allows investors not to monitor the situation on crypto exchanges, monitor analytics and respond to bursts of increased volatility.
P.S Token C20 is also a tokenized index value of Crypto20.
4.Bitwise Investments — $4 000 000 raised.
This is one of the well-known cryptocurrency index funds that has repeatedly applied for SEC approval. The fundraised over $ 4,000,000. Bitwise Investment Fund invests in its own cryptocurrency indices Bitwise 10 Large Cap, Bitwise 20 Mid Cap, Bitwise 70 Small-Cap and Bitwise 100 Total Market.
Indexes display the weight of each coin by capitalization. The composition of the portfolio is changed every month manually, based on data from fund analysts.
P.S Bitwise Investments funds operate in the United States and many other countries of the Western Hemisphere.
5.Amun Crypto Basket Index (HODL5) — $4 000 000 raised.
The next fund is based in Switzerland and has several tracking indexes. Amun also acts as a provider of ETP products for the cryptocurrency market and has a full legal part for this.
Amun crypto basket index (HODL5) tracks the performance of the 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 the market in the market cap. They do not include tokens that are anonymous, e.g. Monero and zCash, cryptocurrencies that lack sufficient liquidity; those cryptos that trade on non-reputable exchanges and those that have not been traded for 6 months in the minimum.
According to its 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%.
P.S In order to invest in one of the indices, the fund offers several options, including through brokers on the Swiss stock exchange.
6.Ember Fund — $1 000 000 raised.
Ember Fund is another cryptocurrency fund, just like CIX.Fund has low lows here, and it starts with an investment of only $ 100. One of the drawbacks of the Ember Fund is that it does not allow users to compose their index or portfolio, but instead, users can select predefined portfolios compiled by the Ember Fund team. Any portfolio can only be purchased through Bitcoin, and you can simultaneously store up to three different portfolios.
The fund follows its own Marius 5 S-Tier index, which in turn includes coins such as Basic Attention Token (BAT), Dent (DENT), Ethereum (ETH), Nexo (NEXO) and Enjin Coin (ENJ).
Ember Fund charges a 1.5% commission on the final withdrawal of funds. Ember Fund is a new market participant, and although he has a small team, they are doing everything possible to improve the product and fulfill their mission.
7.Cryptos Fund — N/A.
Cryptos Fund fund that tracks the index CCi30. The CryptoCoin Index was launched in October 2017 by a team of specialists led by Igor Rivin (a professor of mathematics at Temple University, a royal professor of mathematics at the University of St. Andrews), Carlo Shevola (a specialist in the field of legal and financial consulting services) and also by Robert Davis (engineer, IT expert and programmer).
The index includes 30 cryptocurrencies with the largest market capitalization, where each of the crypto assets is given a weighting. A full recalculation of the components of the index portfolio CCi30 is carried out quarterly, while the weighting of the components is recalculated every month. The CCI30 index allows creating a balanced portfolio that maximizes profits and minimizes risk and volatility. Today the CCi30 is used by the Cryptos Fund for passive tracking of quotes of cryptocurrencies.
P.S At the time of writing, the fund’s website is under construction.
8.Bitfinding — N/A.
Bitfinding is a fund that was launched relatively recently (Beta). Allows you to track cryptocurrencies according to your own internal MKTCAP index, with which users can diversify their risks with the possibility of instant reinvestment, that is, you can configure the option and all earned savings will be re-invested in the index.
The fund manages your funds through the API, while not having keys to your funds.
P.S. So far, the project is relatively young but promising. The information will be updated.
9.ITI Fund — N/A.
This fund also invests in its own indexes created by the MVIS and CryptoCompare index providers. The foundation is located in Luxembourg and works primarily with EU citizens.
The index is rebalanced quarterly by ITI Fund specialists and is based on market capitalization, as well as on other factors of the index methodology. Has a fully trained legal unit in Europe.
P.S. The fund has extensive experience in the traditional financial sector.
10.Isonex Capital — N/A.
Isonex Capital is also a tokenized crypto index fund that invests in the top 15 coins and holders are able to buy into the fund through a single token called IX15.
Isonex Capital utilizes an Equal-Weight strategy to determine the weight of each of the coins 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.
P.S The fund maintains a correlation with the dollar.
Conclusion
I have compiled a list of the currently most famous funds investing in indices and this list will be updated. Keep for updates!
Thank you for your attention!
