The crypto asset market is highly volatile, cyclical and it is becoming increasingly difficult to protect a portfolio in times of stress. Built on experience through both bull and bear markets, CRYPTO10 Hedged fund is designed for drawdown protection when the market is under stress.
The team at Invictus Capital pioneered the world’s first blockchain index fund (CRYPTO20) and have now launched a new fund; CRYPTO10 Hedged (C10).
The C10 fund is rebalanced weekly and has a dynamic cash allocation that provides drawdown protection to preserve capital gains in the event of a market downturn.
The fund rules were extensively backtested; C10 invests in the top 10 crypto-assets with the objectives of maximizing long-term growth and protecting capital gains.
C10 is designed to provide superior risk-adjusted returns relative to pure crypto exposure. The C10 fund began trading in May and has delivered 28% growth over the 3 months since its inception.
The C10 fund offers investors immediate liquidity to buy and redeem C10 tokens via a smart contract i.e. there is no lock-up.
Investors are issued fund tokens and have immediate access to redeem funds via the Invictus Capital investor portal. This 24/7 redemption feature protects investors from liquidity concerns and mitigates the potential for slippage.
Fund rules were determined to optimize the fund’s Sortino Ratio; allowing exposure to upside volatility while protecting against drawdowns.
CRYPTO10 Hedged was designed by selecting optimal index hyperparameters following a scientific approach based on judicious data science.
Time-invariant backtests show that a fund following a top 10 index, rebalanced weekly, with a 15% cap per asset and a dynamic cash hedge, is expected to provide superior risk-adjusted returns. See the C10 litepaper for more detail on backtesting results.
When the fund has a cash allocation, this USD amount is deployed to margin lending on crypto exchanges. This crypto money market has consistently delivered an average of 16% interest returns. The performance of this cash allocation is an effective hedge against a bear market.
Lending returns as high as 40% have been achieved on some days and, this interest income is earned daily. Margin lending returns are shared with the fund and have thus far offset the fund management fee.
Every C10 token interaction is publicly viewable and verifiable on the Ethereum blockchain, offering investors complete transparency.
Invictus Capital strikes a NAV (net asset value) for the C10 fund hourly. Investors receive quarterly reports on the fund and market performance and the C10 fund fact sheet is published monthly.
C10 does not require investors to trade on an exchange. Avoid the risk and frustrations of cumbersome depositing and withdrawal processes on exchange. BTC, ETH, DASH, and TUSD are accepted for investment.
There will always be liquidity for investors looking to enter or exit the fund as investors trade directly with Invictus without exchanges being involved.
The CRYPTO10 Hedged fund is an innovative investment product that makes that future possible today.