Welcome to my review of TokenMetrics.com where I will review my experience with Token Metrics. I will walk you step by step on my journey through trading and investing using Token Metrics. Then you can decide if this is the right tool for you to use in your investing/trading strategy. Note, I am not a financial advisor and none of the content on this website is to be used as financial advice.
Will Token Metrics out perform a Professional Trader?
This is a very good question to ask in order to gauge the win ratio of a professional human trader versus the Token Metrics' Indices. First off, professional traders have a win ratio slightly over 50%. So that is slightly better than a coin toss. That being said, close to 90% of traders lose money and nearly most of those will quit and throw the towel in after 1 to 3 years. Let's use an example of a conservative day trader who takes 1.5% gains and stop losses at 1%. Let's say his win ratio is 55%. So his cumulative monthly gain would be roughly 11.25% or 135% annually.
So how does this compare to the Token Metrics Indices? There are currently 14 Indices available on the Token Metrics website. They are separated into 2 categories. The 1st category is the "Value Investor" category, which are the long term Indices: quarterly and annually. The 2nd category is the "Trader" category, which are the short term Indices: daily, weekly, and monthly.
From the 1st category, the best performing indices is the "Value Investor Annual Balanced (VIAB)" which has a 77.08% ROI.
From the 2nd category, the best performing indices is the "Trader Monthly Weighted (TMW)" which has a 80.47% ROI.
The ROI is measured from the percent gain since inception of the Indices. Unfortunately, I was not able to see the date of inception. So I had to to my own test.
In the crypto world, Bitcoin is the dominant coin. So in order to test the indices, I would need to compare the gains to Bitcoin. So I decided to test the TMW indices. I compared investing $10,000 into Bitcoin versus $10,000 into the TMW indices.
TMW is a monthly updated indices, so my start date was Oct 31, 2020. Which do you think performed better? Let's take a look and compare the charts.
TMW recommended the following coins and percents. I used $10,000 total investment and came up with the following numbers.
Conclusion:
Will Token Metrics' Indices out perform a Professional Trader?
Professional Trader: 11.25% gains
Bitcoin: 21.1% gains
Token Metrics' TWM Indices: 32% gains
From my testing and example, the Indices out performed the Professional Trader and Bitcoin in 30 days.
The TWM Trader Weighted Monthly indices seems to be the best performing indices at the moment. With the monthly indices, it would be best to reallocate the coins accordingly once a month. Then sit on your hands for 30 days and watch the gains come in.
Interested in testing out the Token Metric Indices for yourself?
If you want to get a feel of the Token Metrics website and not have to pay for a paid subscription, you can check out the details on how to setup a FREE account with Token Metrics here.