eToro, the popular cryptocurrency trading website, is partnering with The TIE, a cryptocurrency information services firm, to implement a Twitter sentiments trading portfolio, which lists Dash as its largest position.
— The Block (@TheBlock__) October 15, 2019
The announcement discusses how the TIE-LongOnly CopyPortfolio leverages social Twitter sentiment, both positive and negative, as a significant indicator to compensate for the fact that most cryptocurrency fundamentals are still maturing and thus do not have revenue, dividends or debt. Guy Hirsch, US Managing Director of eToro, specifically discussed how this crypto portfolio will even up the gap between retail investors professionals.
“In traditional markets, retail investors have historically lagged behind the ‘smart money’ when it comes to the data and tools available to them. This puts individual investors at a major disadvantage. In the spirit of crypto and decentralized technology, we believe that offering institutional-grade tools to every investor will level the playing field and democratize investing.”
At the time of writing, Dash comprises around 47% of the entire portfolio, in addition to ranking Dash as a “High” daily sentiment on its main website. The TIE-LongOnly CopyPortfolio pulls in over 850 million daily tweets and uses this data to “algorithmically allocate to a subset of 13 coins on a monthly basis” and with “a minimum of three positions always held
Empowering individuals with diversified investment options
eToro specified in their announcement that they also plan to release “two additional CopyPortfolio strategies from The Tie, including a Long-Short and Market-Neutral strategy, in 2020”. This indicates, along with the name, that the TIE-LongOnly CopyPortfolio is algorithmically programmed to invest in coins that have a sentiment index that bodes well for long term performance and returns.
As eToro explained, this further helps narrow the gap between retail traders and institutions, especially when both parties have very little fundamentals to go off of for trades and investments. Dash’s more positive performance and ranking coincides well with the reports that traders use Dash as their investment vehicle since it allows them to make trades quickly and cheaply and thus take advantage of arbitrage opportunities.
What makes this high sentiment possible
The first explanation for Dash’s large composition of the portfolio launch and its high ranking is simply that Dash makes a great product and service that solves the payment and investment needs of individuals, whether it is traders, consumers, or merchants, and that major industry pundits have not yet caught up with this, causing individuals around Twitter to speak positively of it and in high hopes that it will continue to perform well into the long-term future. Additionally, Dash’s ability to fund various marketing efforts enables consumers to discover the attributes of Dash that benefit them the most without having to comb through the internet, which not only creates short-term interest, but also long-term belief of success as seen by its large inclusion in the TIE-LongOnly CopyPortfolio.