Introduction
I had an opportunity that I could not refuse about the premium version of Shrimpy and decided to make the jump. I wanted to learn about the advantages of the portfolio rebalancing strategy anyway.
Most people only read about new stuff and do not take action. You need to try something, otherwise, you can't discover the potential of a project.
You need to learn by doing it and making sure you acquire the proper knowledge. - Chesatochi.com
The hurdles I got
I completely forgot that most trading exchanges have a minimum in place to make a trade possible. In the case of Bittrex international, it is about 50000 satoshi for any trade that involves Bitcoin.
In the beginning, I tried with 10 assets and I wanted to understand why my immediate rebalance was not working. I diminished the number of assets to 4 and even with that, I had some issues.
I needed to increase my liquidity in order to respect the limit of 50000 satoshi. You cannot apply this strategy with a low volume and need to put a certain amount to make it worth it.
My current test portfolio
In the white paper, they talk about the medium crypto market cap between 9 to 69 million. I made the effort to find a few assets in Bittrex International that respect specific criteria.
I came up with the following assets:
- Quant (weight 25%)
- Zilliqa (weight 25%)
- Siacoin (weight 25%)
- Steem (weight 25%)
I decided to choose those assets only as a test purpose, without evaluating the project with fundamental analysis. My objective is straightforward, it is to test the software and to understand more about the strategy of rebalancing.
What do you need to consider before trying it?
You need to put a certain amount of money to respects the rules of the trading exchange you use. Otherwise, you will face the issues I experienced with low liquidity.
Also, it is important to plan the percentage of each crypto assets that you want to use in your portfolio.
Furthermore, you need to include the fees and the timeframe of the balancement. I discovered that on a daily timeframe, it is not recommended to use the 1 hour timeframe since it costs to much.
Next step
I plan to make a video about the interface of Shrimpy and talk precisely about the creation of the test portfolio I created. You will have a clear idea of what to expect if you take a membership on the website.
Furthermore, I will look deeper at the social aspect where you can monetize your talent. Basically, you create a portfolio and people follow you in the hope to make a profit.
Last word
I took the jump and work with a test portfolio of 4 assets with a weight of 25% each. What I need to do is to increase my liquidity to make the rebalacement to work.
In life, you learn more when you make mistakes. - Chesatochi.com
If you find this information valuable, you can join the program under my affiliate link.
Chesatochi.com - For the love of crypto and coffee
PS: I am not a financial adviser and this is only my own opinion. Always do your own research before to embrace any type of investment in the crypto space.
Posted from my blog with SteemPress : https://chesatochi.com/first-experiment-to-build-a-portfolio-with-shrimpy-premium/