Our investment strategy
At Hodl we offer diversified investment funds that use multiple facets to create yield for our customers. When talking about our investment strategy security does not necessarily seem to fit the cryptocurrency market. However, security should be the basis of anything crypto-related. To offer security we have implemented Ledger Vault, a highly secure method for storing our cryptocurrencies. These cryptocurrencies are held in so-called cold storage. This is a method where coins are stored on devices without an internet connection. In the Ledger Vault we store our Hodl portfolio, the coins we plan to hold for long amounts of time.
Active Portfolio Management
Every day our traders are busy managing the investment portfolios. The funds are constantly rebalanced, changed and innovated. There are a certain number of factors we weigh in to decide how to adapt our portfolio to the state of the market. First, we constantly make a technical analysis of each of our assets. When certain trends appear in the market it might be attractive to switch around our investments. Second, we are always looking for new investment opportunities.
When looking for new cryptocurrencies we first start by looking for a realistic use-case of these coins. A realistic use case entails that there is a problem, and this cryptocurrency aims to offer a realistic solution. Then it is time to look at the tokenomics of a project, crypto slang for how the token is used in their blockchain ecosystem. Furthermore, we look at social statistics, exchange listings and many other factors.
Algorithmic Trading Bots
Cryptocurrency is a 24-hour market, and even though our traders work awfully hard, they also need to sleep. Luckily for us, we have developed our algorithmic trading bots designed especially for cryptocurrencies. This makes it possible to trade optimally as well as generate extra returns 24-hours a day. Trading bots are gaining in popularity and for good reason; they do not sleep, have no emotions and will follow the established strategy without any doubt. With artificial intelligence (AI) and machine learning, the bots keep making themselves smarter.
DeFi Services (Decentralized Finance)
DeFi is also known as Decentralized Finance offers a lot of opportunities in the world of cryptocurrency. For most regular investors, these services are too complicated, not profitable and require too much maintenance. However, when using a large number of funds these DeFi mechanisms start becoming interesting. So, what exactly do these DeFi services do?
First, Hodl runs nodes for a select number of cryptocurrencies. By running a node, users can strengthen the security of a blockchain. For running these nodes rewards are given in the form of the ecosystem’s cryptocurrencies. Staking relies on a similar premise, by staking your cryptocurrency you strengthen the network and are therefore rewarded. Another service we make use of is providing liquidity for certain currencies. By providing liquidity you are helping the community create a healthy supply and demand. Finally, a small portion of the DeFi services is focused on Airdrops. Airdrops are free tokens that are distributed to all token holders. Thus, a perfect way of generating constant profits is achieved.
All in all our portfolio exists out of three layers of cryptocurrency, first, we have the Hodl coins. Coins that have proven themselves resilient and are highly liquid. These coins will stay in our portfolio permanently and include coins such as Bitcoin and Ethereum. The second layer consists of cryptocurrencies with a technological application and have been developed by renowned teams, demonstrated practical use-cases, and great potential. These coins will stay in our portfolio for the long term. Finally, we have our third layer, this is a limited part of our portfolio that contains speculative cryptocurrencies that we have researched and believe will generate short term gains. With our active portfolio management, algorithmic trading bots and yield generating DeFi services we are constantly growing and adapting our portfolio to bring optimal yields.