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CIF 200 - The cryptocurrency index

The benchmark for the entire cryptocurrency market includes up to 200 assets and knows returns of almost 15,000 percent. Compare your real investment return with CIF200 to make better decisions and more money.

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Introduction

Cryptocurrency market

The incredible hype around the Bitcoin has raised many people’s attention. Up to the year 2017 the cryptocurrency market for investors was mainly determined by Bitcoin and few others. In the year 2017 the class of "smaller coins" showed larger growth rates (see "others" in chart) in comparison with Bitcoin, rendering it viable for professional investors. Currently, this class includes nearly 1500 different coins owning almost 20% of total cryptocurrency market capitalization. However, despite owning large growth potential in the near future, most private investors were, up to the present day, not attracted by the broad class of smaller coins, since it is too large in numbers, too complex and too difficult to monitor.

CIF200 comes into play

A capped-index of 200 coins is introduce with a percentage limit of 2% per coin and a rebalancing interval of 14 days for easier tracking and lower trade fees. This ultimately leads to an index depicting the entire cryptocurrency market (see portfolio [link]) which lends itself perfect for investors, who wants to participate in growth of cryptocurrency and blockchain without the need of being an expert and spending much time in analysing the market. Since January 2017 this indexing-strategy shows returns of nearly 15,000 percent in back-testing outperforming Bitcoin by far (see chart [link]).

CIF200 benchmark

Executive Summary

To compare the impressive return of the market with the return on invested capital (ROIC) of an investor, CIF200 is designed like a low-cost index fund. To find an efficient indexing strategy extensive backtesting on historical data was performed. This ultimately results in a passively managed index portfolio with 200 coins termed "Cryptocurrency Index Fund 200" (CIF200) showing growth rates up to 14950%. Finally, a Monte Carlo simulation using geometric fractional Brownian motions is performed, indicating high growth potential at low risk.

Functionality

  • CIF200 is a benchmark index which provides an easy overview to the entire cryptocurrency market development
  • CIF200 works like an index fund and fullfills the needs of investors who are interested in investing in cryptocurrency and/or blockchain
  • The diversified index includes up to TOP 200 cryptos and tracks the top market cap assets by an auto periodically rebalancing mechanism
  • The strategy clearly focuses on the entire crypto market, including its recent developments: wave-like price movements, volatility, etc.
  • Full Functional Index
  • Entire Crypto Market
  • Backtest Proven
  • Strong Team

CIF200 Details

It is not only a friend of a friend who made big money cashing out their Cryptocurrencies. Clever Investors think big. With a larger asset size they can benefit from greater economies of scale which translate to lower expense ratios.

Number comparison

Portfolio performance between January 2017 and June 2018 with a starting value of $ 1.

CIF200 Index, benchmark
Type Passively managed index
Market Cryptocurrency
Strategy Focus on the entire market
Number Up to 200
Rebalancing Periodically
Frequency 7 - 14 days
Capping 2% maximum
Prooven Backtesting on historical data
Start 1st of January 2017
End 1st of June 2018
Price USD 1.00 / USD 57.79
Growth Up to 14950%
Forecast simulation Positive, just 2% of all generated realizations suffer a loss

Why an index?

Activly vs. passivly

99% of actively managed US equity funds underperform the underlying index development. Almost all US, global and EM funds have failed to beat their index benchmark since 2006. 9

High Demand

More than 100 companies offering about 4800 Index Funds. The volume of assets amounts to 3400 bill. $ [12/16]. Unfortunately only very few options exists for the high demand of cryptos.

Successful reasons

If you are not a professional investor, there is no reason not to be interested! Here are the unique features

Benchmark

CIF200 is the standard reference point of the entire market where the return on a real crypto investment can be compared.

Market Overview

Investors can easily track & observe the performance of the cryptocurrency market and up to 200 assets

Proven Strategy

Back-Tests of CIF200s strategy show an impressive result. As the result CIF200 will rebalancing the portfolio periodically

Comparability

CIF200 has the functionality of a low-cost index fund to make the ROIC comparable with the return of the entire market

Low costs

CIF200 calculates no brokerage or exit fees. CIF200 has a 14 day rebalancing interval for easier tracking and lower costs

Strong Team

Each member is highly skilled and determined to realize the company goals and has sufficient back office support

Why CIF200 is an outperformer?

As comprehensive back-tests shows, the CIF200 with a passively managed portfolio leads to great returns. Ignoring this right now could be disastrous. Get involved now.

Performance comparison

Performance of CIF50 vs. CIF100 vs. CIF200 vs WMC200 (CIF200 without capping) vs. Bitcoin vs. ref. Index (weighted index of all coins). EARNINGS FROM $1 INITIAL INVESTMENT since 1st of January 2017.

Historical Return Comparison

Select an investment amount and date to see returns ending June 1st, 2018.

Initial Investment: 1.000

Purchase Date: -

CoinValue%
C20 IconCIF200$143,432.082676%
BTC$40,390.08682%

Performance simulation

The cryptocurrency market continues to grow. He is still very attractive. The forecast simulation shows, that the creation of a cryptocurrency index fund 200 could has a high growth potential in the near future.

CIF200 Monte Carlo simulation.

For the calculation of the expected value of the price development a Monte Carlo simulation with 1 million samples has been carried out. It should be noted, that extreme events like the global financial crisis 2008-2009 cannot be predicted by this kind of model. Nevertheless, just 2\% of all generated realizations suffer a loss, which shows, that the creation of a cryptocurrency index fund has a high growth potential. Read More - Risk Warning: This simulation does not constitute a recommendation for investment or a forecast for future development.

Portfolio Composition

A solely capitalization-weighted index would rely mostly on the class of “big coins” like Bitcoin and Ethereum, showing minor performance in back-testing on historical data. The application of a capping-value to the index results in limiting shares of the class of big coins and therefore attaching greater weight to smaller coins. This procedure is mitigating risks by not being overly depend on single coins while concurrently has been shown to increase returns in back-testing on historical data (see chart [link]).

CIF200:

  • The class of big coins is represented with 5 coins owning a share of 10%, illustrating the function of the capping algorithm.
  • The vast majority of all coins are either from the class of small or medium coins with a percentage value to the portfolio of 85%.
  • The composition of the portfolio in terms of market capitalization is depicted at the end of the simulation time window. 49 out of 200 coins in this portfolio belong to the class of micro coins. The percentage share of this class of coins is rather small with 5% indicating a future grow potential with limited risk of loss.

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What Our Users Say

CIF200 has finally given me an overview of the entire market. Now I can get my return with that of the market.

Corey Williams

Teacher

This is a great platform, I learned a lot of new things about the cryptocurrency market.

Sarah Anderson

Student

Before I make a decision about investing in cryptocurrency, I'm watching the latest news on CIF200.

Jim Thurston

Teacher

I love learning new things especially new technologies, using CIF200 I got in to the crypto world really fast. And now I am earning money with my own crypto investments.

Joathan Eyve

Student

Becoming an expert

The cryptocurency world is still a deep jungle. We are here to support you on your journey.

Knowledge

Understand how the Blockchain potentially affects your portfolio & your financial freedom. Identify which strategy is most important to you.

Skills

The best way to learn is by using your skills. That’s why CIF200 is a scientific project that allows you to practice and receive feedback directly.

Sucess

Keep it simple. Our success has proven us right. Check your strategy and return on your investment compared to CIF200 now. Feel free to learn more from us.

This is it - The Team

The team includes specific experts. Each member is highly skilled and has sufficient back office support.

If you would like to become a part of our great team, feel free to contact us: team@cif200.com

Frank Consumer protection Organisation
Frank Consumer protection + Organisation
Maximilian Datascientist transparency officer
Maximilian Datascientist + Transparency
Christian Benchmark Expert Social
Christian Benchmark Expert + Book author
Andreas Networking Social
Andreas Networking + Marketing
Jonas Computer scientist + Web application
Jonas Computer scientist Web application
not announced Marketing Social
not announced Marketing Social

Roadmap

Spring 2018

Development of crypto index-concept

Mid 2018

Creation of a first benchmark concept

Autum 2018

Development of related elements and Start of the entire benchmark

Spring 2019

Public Launch of CIF200 and start online with the benchmark

Goal 2019

CIF200 becomes a standard benchmark

Goal 2020

CIF200 shows the best performance in the entire crypto market since its beginning

Competence Partner

If you would like to become one of our competence partners, please contact us at: partner@cif200.com

Location

CIF200 is a scientific project developed in Germany.

Frequently Asked Questions

Answer: Cryptocurrencies are a completely new approach to organize payment, where one unit or coin is displayed as encrypted data, protecting it against unauthorized copying and counterfeiting. Hence, they are an element of a payment system based on “cryptographic proof” rather than trust. It is a straightforward peer-to-peer system using a decentralized ledger, a so called blockchain, which does not need a central authority, repository, or any kind of intermediation of trusted third parties such as banks or payment system providers to verify a transaction.
Answer: "Initial Coin Offerings" (ICO) enables companies to raise capital according to a kind of crowdfunding system. Corresponding to the overall development of cryptocurrencies, the years 2017/18 witnessed a sharp increase in ICOs. Most ICO activity can be found in the USA (equivalent to 1031 million US\textdollar), followed by Russia (310 million US\textdollar), Singapore (260 million US\textdollar), and China (256 million US\textdollar). Germany (187 million US\textdollar) is in the seventh place worldwide and leads the ranking in Europe. The values of the new ICOs and the numbers of existing cryptoccurencies worldwide, as in figure 1, shows that this is a global evolution and it looks like cryptocurrencies have come to stay in the market.
Answer: It appears that cryptocurrencies might emerge as a new asset class with the potential to set up as a viable investment and diversification instrument. There is some evidence that cryptocurrency returns are essentially uncorrelated with customary asset classes, so they might well serve as a new instrument to diversify portfolios. While there is still some disagreement on the question of whether cryptocurrencies should be classified similar to precious metals, speculative assets, or as something in between a commodity and a currency, they are undoubtedly a highly speculative investment with a still rather limited market capitalization.
Figure 1 in the CIF200 Paper shows that market capitalization and prices had emerged rather slowly over the years until the first half of 2017, but then suddenly increased drastically and reached a peak in the first quarter of 2018. In fact, the total capitalization of the cryptocurrency market increased by more than $1100 \%$ during the year 2017, outperforming many traditional assets and this way attracting the interest of investors already searching for new investment opportunities.

Answer: A viable strategy for investors with a long-term focus is the so-called indexing, i.e. the allocation of assets in a portfolio that matches the composition of an index. A portfolio that tracked the top ten cryptocurrencies clearly outperformed the development of the Bitcoin currency already in 2017 \cite{buehler2017crypto}. This obviously calls for the creation of a cryptocurreny index fund (CIF) similar to equity index funds allowing investors to follow a passive investment strategy by providing them with a viable instrument to track market developments and replicate the index at low cost \cite{buehler2017crypto}.

Principally, a CIF should model the development of cryptocurrency prices in a similar way a stock market index records value changes of an equity basket or portfolio representing a specific market or market segment. Table 1 in the CIF200 Paper shows a collection of assorted equity indices with the respective number of constituents and market capitalization. It is apparent that the capitalization of equity markets - especially in a global context - is still far beyond the capitalization of the cryptocurrency market which is apparently only at the beginning of its development.

Answer: Index funds are a special type of mutual funds with a portfolio that replicates a specific equity index both in terms of structure and value. Exchange-traded funds (ETF) essentially are open-end index funds which track an index as closely as possible and are traded like a common stock at the stock exchange in real time. Therefore, they combine the efficiency and simplicity of on-exchange trading with the advantages of indexing. Investments in ETFs showed an impressive development in recent years. In Europe, there are more than 50 fund companies offering nearly 1600 ETFs. The total volume of invested assets exceeds 540 billion US ~compared to a volume of a good 100 billion US a decade ago. Worldwide, there are more than 100 fund companies offering about 4800 ETFs and the volume of assets invested amounts to 3400 billion US\textdollar ~\cite[][as of December 2016]{sfama2017swiss}. Assuming efficiency of capital markets, this is actually the most yielding long-term strategy for a given level of risk \cite{wetzel2000aktienindizes}. Actively managed funds with individual portfolios are associated with extra expenditure for transactions fees and research cost and are, in fact, often outperformed by the market in the long run\cite{wetzel2000aktienindizes}.

Answer: The cryptocurrency market is presently more and more gaining efficiency ``with updated versions of traditional financial intermediaries''. In the cryptocurrency market, there are currently very few options for easily diversifying a portfolio. There exist only a few cryptocurrency indices like the TaiFu 30, and these are mainly intended to ``gauge the health and ‘pulse’ of the cryptocurrency markets'' rather than serving investment purposes. A CIF designed for the latter should ``provide a broad-based exposure to the crypto market, where no single cryptocurrency or specific group thereof dominates the index'' and therefore should aim at fairly representing the complete diversity of the cryptocurrency market. As a result, a CIF designed for investment purposes should incorporate a considerable number of well assorted currencies. Finally, a CIF should be based on market capitalization and liquidity data to appropriately reflect cryptocurrency market dynamics. Sufficient liquidity of the constituents is an important prerequisite for the attractiveness of such an index as a guideline for investors. In order to find an efficient portfolio indexing strategy we will determine the factors for the composition of a suitable portfolio.

About

CIF200 wants to become a standard benchmark for the entire cryptocurrency market. This scientific paper was developed in Germany.

We want to connect people and give everybody more access to informations about the cryptocurrency market.