Info about ClearGate strategies on Sommelier protocol
Trend following portfolio in BTC and ETH
Cellar description: The cellar accumulates BTC and ETH with a medium to long term perspective. The rebalancing decision between BTC and ETH is based on following price trends.
Momentum portfolio in BTC and ETH
Cellar description: The cellar accumulates BTC and ETH with a medium to long term perspective. The rebalancing decision between BTC and ETH is based on price momentum.
Differences between the cellars
The following information outlines the differences between two distinct BTC and ETH portfolio cellars and may help in choosing between Trend following portfolio in BTC and ETH (Trend-BE) and Momentum portfolio in BTC and ETH (Mom-BE).
- Trend-BE follows price trends, Mom-BE accumulates assets by their price momentum
- Mom-BE reacts faster to price rises than Trend-BE because identifying price trends with greater accuracy takes more time than observing price movements
- Its faster reaction to price appreciation means the Mom-BE strategy may make more trades that do not end profitably
- Mom-BE always holds some risky assets whereas Trend-BE does not hold any risky assets when no positive or neutral price trend is detected
- Trend-BE provides less volatility and more stability at times when prices are falling
- Mom-BE may outperform Trend-BE in the short run and when prices are rising fast, but Trend-BE should outperform Mom-BE in a longer time frame and offer better risk-return characteristics