Shrimpy: portfolio rebalancing is more effective than strolling

Studies by cryptocurrency portfolio management platform Shrimpy have shown thatrebalancing the investment portfolio is by far the most profitable investment strategy.

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In the process of analyzing investment strategies,Shrimpy analysts have tested multiple crypto portfolios in terms of the number of assets, composition and frequency of their rebalancing over one full (market) year and concluded that the position of holding crypto assets is inferior to the effectiveness of the rebalancing strategy.

Shrimpy analysts concluded that &#171;the ideal portfolio is often rebalanced and contains many assets&#187;:

“As a result of these studies, we identified 2the main reasons for increasing the efficiency of the investment portfolio. First &#8212; this is an increase in the number of assets in it, the second &#8212; increasing the frequency of its rebalancing"

As a result of comparing these portfolios in terms of efficiency, the company came to the conclusion that &#171;hodl is inferior to rebalancing by 64%, and after taxes&#8212; by 92%&#187;.

Shrimpy compared, among other things, the success of small portfolios of 10 stocks each. And we got interesting statistics:

“Portfolios rebalanced every month with 10 randomly selected stocks outperformed over the course of the entire year, on average 99.75%. Rebalancing with a period of 1 hour - already by 234%"

Research conducted by Shrimpy contradicts the widely held belief that hodl is the best way to invest in cryptocurrency.

Undoubtedly, hodling brings benefits, especially whenlong-term storage. For example, thanks to this strategy, a programmer who invested $115 in Bitcoin was able to buy a Lamborghini, and researchers continue to study Hodl waves, but rebalancing can be considered an equally effective strategy.

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