I started my trading strategies with the simplest of all,
buy and hold (Scenario 1). I started with $10,000 divided between 3 coins, BTC,
ETH, and LTC. I purchased the maximum of each coin on the first day of each of
the last 6 quarters. Then all were sold on the last day of the quarter. The
following table summarizes the results.
|
Scenerio
|
2018-Q1
|
2018-Q2
|
2018-Q3
|
2018-Q4
|
2019-Q1
|
2019-Q2
|
|
|
Direction
|
Down
|
Down
|
Flat
|
Down
|
Flat
|
Up
|
|
|
Index Slope
|
-44.20
|
-14.13
|
-4.71
|
-27.35
|
2.48
|
43.90
|
|
|
1-BuyAndHold
|
-$4,813
|
-$1,552
|
-$2,712
|
-$4,419
|
$3,168
|
$12,174
|
BTC ETH LTC
|
|
1a-BuyAndHold
|
-$6,480
|
-$890
|
-$480
|
-$4,850
|
-$248
|
$10,759
|
BTC BCH XRP
|
Direction is an arbitrary description I assigned to each
quarter based on the Index Slope. Originally, I used 3 coins, BTC,
ETH, and LTC. Then I decided to run the program again with BTC, BCH, and XRP
(Scenario 1a). There was a big
difference in the results. I looked at the individual coins for quarter 1 of
2019.
|
2019-Q1
|
BTC
|
ETH
|
LTC
|
BCH
|
XRP
|
|
Original coins
|
0.8591
|
23.3656
|
103.7775
|
20.1996
|
8,987.1484
|
|
Original price
|
$3,880.15
|
$142.66
|
$32.12
|
$165.02
|
$0.37
|
|
Final price
|
$4,112.69
|
$142.40
|
$60.78
|
$169.54
|
$0.31
|
|
Original Value
|
$3,333
|
$3,333
|
$3,333
|
$3,333
|
$3,333
|
|
Final value
|
$3,533
|
$3,327
|
$6,308
|
$3,425
|
$2,794
|
|
Net gain/lost
|
$200
|
-$6
|
$2,974
|
$91
|
-$539
|
Clearly LTC was a significant factor in the overall results. It
basically doubled during the period. The message here is this buy and hold
approach is great if you pick the right coin. But it’s also boring if you want
to be a trader. It also may be the best strategy and will be used as a baseline
to compare other strategies to.
Next I’ll look at a 1st alternate trading strategy that
involves making trades daily. I’ll post on Twitter @billlanke when I post.
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