eToro launches sentiment-based algo-driven investment strategy for crypto. The TIE’s Long-Only portfolio strategy has generated an annualized return of 123% on average, compared to a 29% return from an equally weighted basket of the same underlying crypto assets. The strategy allocates based on positive sentiment, algorithmically rebalancing once per month.
The leading global investment platform has launched TheTIE-LongOnly CopyPortfolio, a sentiment-based, aIgo-driven investment strategy from cryptocurrency data analytics platform The TIE. eToro will be debuting two additional CopyPortfolio strategies from The Tie, including a Long-Short and Market-Neutral strategy, in 2020.
TheTIE is trusted by some of the largest traditional quantitative hedge funds as well as crypto-specific funds. Since launching the strategy in October 2017, the algorithm has generated a 281% return after fees, compared to a 41% return generated by Bitcoin alone
Guy Hirsch, US Managing Director of eToro, said: “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.”
The TIE’s Partner CopyPortfolios were developed in collaboration with Social Market Analytics, an investor in The TIE and a premier provider of quantified sentiment data to the world’s largest financial firms.
Joshua Frank, Chief Executive Officer of The TIE, commented: “eToro is well-known as a community where some of the smartest crypto traders share insights and strategies. We’re proud to offer investors of all experience levels a way to employ artificial intelligence and machine learning in an automatically-executed strategy, unified with eToro in our goal to make traders more active and informed.”
Given the absence of revenue, dividends or debt, social sentiment — people’s positive or negative perceptions — is a significant indicator of crypto asset price movement. The Tie’s proprietary machine learning and language processing models ingest 850 million tweets per day, quantifying the positive and negative tone of conversations on Twitter.
eToro has been at the forefront of the cryptocurrency trading movement as an early supporter of digital asset trading. The broker has recently launched a portfolio, offering investors the opportunity to take a stake ($2,000 minimum) in the companies involved in Facebook’s Libra project. Comprising of the 13 publicly-traded companies involved in the Libra Association, the portfolio will add more firms as they join the project and rebalance it where possible.
“eToro’s mission is to open up global markets for everyone and is the only place retail investors can get exposure to developing technologies such as the Libra Coin, via a managed and regulated investment product for free”, said Yoni Assia, Chief Executive Officer and Co-founder of eToro.