Zombie Apocalypse Edition – I bought $1000 worth of the Top Ten Cryptos on January 1st, 2018 (March 2020 Update) : CryptoForeign money
2018 “Index Fund” EXPERIMENT – Tracking Top 10 Cryptocurrencies of 2018 – Mar 2020/Month Twenty-Seven Update – Down 87%
See the full weblog put up with all the tables right here.
tl;dr – take care of yourselves, your households, and your communities. Keep up the social distancing, bend the curve, wash your arms. Be cautious on the market. And – a really insane month. Despite the market meltdown, crypto has beneath-carried out the market since January 2018 by fairly a bit. But when you measure from Jan 2019 or Jan 2020 it is a completely different story.
Month Twenty-Seven – Down 87%
Welcome to the particular COVID/Zombie Apocalypse model of the replace. An all crimson month, however, meh, that is cypto, we’re used to it.
Ranking and March Winners and Losers
For such a loopy month, there wasn’t a lot motion with this group. For the second month in a row, Cardano fell two positions and Bitcoin Cash slipped one slot. NEM was the solely crypto to climb, up one place in March. Always bought to take the alternative to report one thing optimistic about NEM!
The total drop out fee continues to be at 50% mark (that means half of the cryptos that began 2018 in the Top Ten have dropped out). NEM, Dash, IOTA, Cardano, and Stellar have been changed by EOS, Binance Coin, Tezos, Tether, and BSV.
March Winners – Bitcoin squeaked out a victory in March, though BTC was principally in a 3 means tie this month with XRP and Dash. All have been down -23%.
March Losers – In an all crimson month, ETH and Cardano did particularly poorly, down -38% and -33% respectively.
Below is tally of which cash have the most month-to-month wins and losses in the first 27 months of the 2018 Top Ten Crypto Index Fund Experiment. Most month-to-month wins (7): Bitcoin. Most month-to-month losses (5): Stellar. All cryptos have at the very least one month-to-month win and Bitcoin now stands alone as the solely crypto that hasn’t misplaced a month (though it got here shut in January 2020), when it gained “only” +31%).
Overall replace – BTC far forward, ETH and LTC just about tied for second place, IOTA and NEM just about tied for final place.
Although down -50% from January 2018, Bitcoin continues to be properly forward of the discipline. Ethereum and Litecoin are virtually tied for second place, down -81% and -82% respectively.
While NEM technically stays in the basement, IOTA is knocking at the door. Both are down -96%, and IOTA is now just a few cents off in complete return.
Total Market Cap for the whole cryptocurrency sector:
The total crypto market misplaced about $60B in March 2020 and is now down -68% from January 2018.
Bitcoin dominance bounced up about +1.5% in March, one thing we’ve seen time and time once more over the course of the experiment when the market bleeds. For context, the vary since the starting of the experiment in January 2018 has been fairly large: a excessive of 70% in September 2019 and a low of 33% in February 2018.
Overall return on funding since January 1st, 2018:
The 2018 Top Ten Portfolio misplaced about $53 bucks in March 2020. If I cashed out immediately, my $1000 preliminary funding would return about $133, down -87% from January 2018. This isn’t fairly the low level for the 2018 Top Ten (the portfolio was down -88% in January 2019) however fairly shut.
See, right here’s the ROI over the life of the experiment, month by month:
A sea of crimson. The closest the 2018 Top Ten group has come to breaking even was after the very first month, when the portfolio was down “only” -20%. March 2020 is now the eighth consecutive time the portfolio has ended the month down at the very least -80%.
The 2019 and 2020 Top Ten Experiments are nonetheless in optimistic territory, however not by a lot:
Taking the three portfolios collectively, right here’s the backside backside backside line:
After a $3000 funding in the 2018, 2019, and 2020 Top Ten Cryptocurrencies, my portfolios are worth $2,267.
After lastly, at candy lengthy final, ending the first few months of 2020 in optimistic territory for the mixed portfolios (January up +13% and February up +6%), that’s down about -24% complete. Thanks coronavirus.
Alright, but it surely’s the finish of the world as we all know it, all the things’s tanking. How does this examine to conventional markets?
Comparison to S&P 500:
I’m additionally monitoring the S&P 500 as half of my experiment to have a comparability level with different fashionable investments choices. March 2020 was not an amazing month for the S&P: it misplaced over -20% of its worth this month and is presently at the lowest level since the experiment started in January 2018: -Eight% since the begin of 2018. The preliminary $1k funding into crypto would have misplaced me about -$80 had it been redirected to the S&P.
Taking the identical drop-$1,000-per-12 months-on-January-1st method with the S&P 500 that I’ve been documenting by means of the Top Ten Crypto Experiments would yield the following:
$1000 funding in S&P 500 on January 1st, 2018: -$80
$1000 funding in S&P 500 on January 1st, 2019: -$10
$1000 funding in S&P 500 on January 1st, 2020: -$230
Taken collectively, right here’s the backside backside backside line for the same method with the S&P:
After three $1,000 investments into an S&P 500 index fund in January 2018, 2019, and 2020, my portfolio could be worth $2,680.
That’s down about -11% in comparison with -24% with the Top Ten Crypto Experiment Portfolios.
That’s a 13% distinction. Last month the hole was only one%.
The experiment’s focus of solely holding the Top Ten Cryptos has by no means been a successful method when in comparison with the total market. The complete market cap is down -68% from January 2018 in comparison with the -87% for the cryptos that started 2018 in the Top Ten. This of course implies that I would have achieved a bit higher if I’d picked completely different cryptos.
At no level on this experiment has this funding technique been profitable: the preliminary 2018 Top Ten have beneath-carried out every of the twenty-seven months in comparison with the market total.
There are a couple of examples of this method outperforming the total market in the parallel 2019 Top Ten Crypto Experiment, however these instances are few and much between. In distinction, every of the first three months of the 2020 Experiment present that focusing on the Top Ten beats the total market.
With COVID affecting the whole globe and no finish in sight, the subsequent few months can be powerful. We ought to have a greater concept whether or not crypto is seen as a gold-like protected haven throughout powerful occasions, as some have recommended.
Final phrase: take care of yourselves, your households, and your communities. Keep up the social distancing, bend the curve, wash your arms. Be cautious on the market.
Thanks for studying and for supporting the experiment. I hope you’ve discovered it useful. I proceed to be dedicated to seeing this course of by means of and reporting alongside the means. Feel free to achieve out with any questions and keep tuned for progress studies. Keep an eye fixed out for my parallel tasks the place I repeat the experiment twice, buying one other $1000 ($100 every) of two new units of Top Ten cryptos as of January 1st, 2019 then once more on January 1st, 2020.