Bitcoin, Crypto currency, Blockchain

Investment strategies: Have two professors from Yale the Golden solution?

Two professors at the American Elite University of Yale found out, to the point at which a crypto-Investment is worthwhile. You have taken on this historical price trends of Bitcoin, Ether, and XRP. It’s up to them, the investors should be especially on two-factors of Eight.

Trade, sell, hodln – or even buy more?! Day-to-day crypto-sitting investors glued to the Charts full of red and green candles and play trading scenarios in your head. With the aim to meet in every Situation, the right decision, to get the maximum payout. However, the ultimate recipe to be the course of developments of the Coins does not exist to predict, unfortunately. Or does it?

Price developments predicted by science?

Two University professors, the American Elite University of Yale have accepted the challenge. Together, they have now brought out a Paper in which you give investors a possible strategy. Under the title “Risks and Returns of Cryptocurrency” Yukun Liu and Aleh Tsyvinski tried, course developments, academic methods derive.

You pursue the approach, that you can see the future development of the courses from the past course of developments. The scientists think, to have a Schema recognized. To be able to make statements about the future course stands, they analyzed the data of the Bitcoin rates from 2011 to today. In addition, they looked at data from the Ether and XRP between the years 2012 and 2015, your theory.

Two factors should be at the assessment

The Paper describes two effects that one should consider in principle in decision-making in advance of a trade. The “Momentum Effect”, which describes the current direction in which a Coin moves. The idea behind this is that an upward movement develops self-reinforced, and the course continues to the top. For a Short-Term Investment, an upward trend can represent a buy signal.

The second effect is called “Investor Attention Effect”. This effect describes, simply, how high is the interest in a particular crypto-currency to a given point in time. This is done through a quantitative analysis of Google search queries and the number of mentions of the Coins in Social Media channels such as Facebook or Twitter.

Rather guidelines as a counselor

At a closer Look, the study, called space traders, no data, time, when, how much money in which Coin to invest. Rather, it wants to give investors a on academic-based tool, which will help you to independent decisions. The Paper thus provides more Investment guidelines, as it acts as a counselor.

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