Welcome to our Investor’s guide to cryptocurrency. In this final part, we will introduce how Hodl invests in cryptocurrencies: in-depth analysis, thorough research and a bottom-up strategy that combines a traditional investing approach with the latest technology. Continue reading to find our way into cryptocurrency investing.
Now that we have covered the history of cryptocurrency, the fundamentals and the different investing methods, it is time to provide a general example of Hodl's investment strategy. Hodl uses a bottom-up strategy to distribute the investments in the funds and, by doing so, we can make an excellent risk-return analysis and give our investors the right exposure to the cryptocurrency market. We divide the strategy into three different layers:
The first layer is the most important part of our investments. It consists of renowned digital currencies that are characterized by high liquidity, listings on multiple exchanges and a proven track record.
The second layer consists of cryptocurrencies with a technological application and/or blockchain developed by renowned teams, demonstrated practical use-cases and great potential. Besides our traditional portfolio setup, we apply additional services that generate continuous returns for our investors.
The third layer is a little part of the portfolio and contains speculative cryptocurrencies of which the business model has yet to prove itself but with substantial growth expectations. These investments consist of early access offerings for high-risk, high-reward opportunities. Besides our traditional portfolio setup, we apply additional services that generate continuous returns for our investors.
Hodl uses algorithmic trading and has developed its own trading bots specifically for cryptocurrencies. This brings optimal trading setups and generates extra returns. Trading bots are gaining popularity for good reason: they can operate 24/7, trade without emotions and will follow the programmed strategy neatly without hesitation.
Decentralized Finance (DeFi) services are used to generate additional returns for our investors. This latest cryptocurrency and blockchain technology development offers additional yield opportunities. The DeFi services that Hodl focuses on are staking, running nodes, providing liquidity and airdrops.
We use Ledger Vault, the best-in-class cryptocurrency security solution, offering the highest level of safety. In addition, our investment processes are carefully documented and our accounts are structurally audited by third parties.
In this chapter, we introduced the investing strategy at Hodl. Thanks to our experience in cryptocurrency and the traditional investment world, the Hodl funds are actively managed and balanced daily, based on thorough research into the latest trends and opportunities in the market.
Our unique strategy comes from more than 10 years of experience in cryptocurrency investments, but also our traditional background in finances. As one of the first investment companies, we received an AFM registration for its funds in 2020. In 2021, Hodl funds achieved the highest returns of all Dutch cryptocurrency funds due to this original strategy.
Download our brochure and get the details of our cryptocurrency funds and the role of cryptocurrency in your portfolio.