What are the key metrics to consider when creating a portfolio benchmark for cryptocurrency trading?

1 answers

• Nov 28, 2021 · 3 years ago
  When creating a portfolio benchmark for cryptocurrency trading, it's important to consider the metrics that align with your investment strategy and goals. Different investors may have different priorities, so there is no one-size-fits-all answer. However, some commonly used metrics include the average daily return, which measures the average percentage gain or loss of the portfolio on a daily basis, and the beta coefficient, which measures the sensitivity of the portfolio's returns to the overall market. Additionally, metrics like the Sortino ratio, which focuses on the downside risk of the portfolio, and the information ratio, which measures the portfolio's ability to generate excess returns compared to a benchmark, can also be useful. By selecting the right metrics and regularly monitoring them, investors can effectively track the performance of their cryptocurrency portfolio and make informed decisions.
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