The gone Tuesday morning marked the launch of a sentiment-based portfolio named “The TIE-LongOnly CopyPortfolio.” The highly anticipated instrument is helmed by a strategic partnership between the eToro exchange platform and data analytics firm, The TIE. The product went live on eToro’s trading network with a minimum buy-in capacity of $2,000.
As per the official news about the new portfolio, it will take advantage of the excellence of Artificial Intelligence tools to scrutinize the Twitter platform for the latest positive or negative inputs concerning the digital assets. Interestingly, The TIE firm claims that it has access to a whopping number of daily tweets, amounting to nearly 850 million via its partnership with Social Market Analytics.
The portfolio algorithms will deal with 13 different coins: BTC, ETH, XRP, IOTA, BCH, NEO, ETC, DASH, EOS, XLM, LTC, ZEC, and ADA. The platform aims to assess the genuineness of the tweet content using machine learning and routine language processing pedagogy. It also checks whether it is about digital currency or not. Post this assessment; the solution will gear up for the real sentiment-crunching where a tweet sentiment will be compared against another tweet sentiment and not with other coins. The algorithmic rebalancing is done monthly.
Joshua Frank, the notable CEO of The TIE, stated that
We found that crypto is an asset class that is void of valuation metrics. With crypto, the only thing that really moves it is supply and demand, so we set out to develop sophisticated solutions for hedge funds to help value and trade the asset class.
The portfolio included five different crypto assets at the time of its first unveiling. These assets included stakes in varied proportions described below:
- 24% DASH
- 92% EOS
- 86% XRP
- 01% MIOTA
- 97% ETC
According to Frank, Twitter serves as an unprecedented source for tracking crypto market movements. He called the social networking platform as “kind of the epicenter of the crypto universe.” The spearhead also stated that “Crypto remains an asset class driven by the wisdom of the crowd.”
The new portfolio is the practical application of eToro’s primary objective to aid retail investors to stand strong in competition with mutual funds and professional entities ruling the crypto domain.
The end result is that retail investors will have the chance to invest using a strategy that was previously only available to hedge funds,
said Guy Hirsh, who works as the U.S Managing Director of eToro. He also clarified that
We hope that this will give people on the fence about crypto a path to enter this asset class, as opposed to trying to figure out for themselves when to sell and when to buy.
Utpal Dholakia, the chief marketing head at Rice University, stated that the employment of tools for analysis of Twitter tweets about crypto would lubricate the process of price rise for the traders.
“Crypto are niche markets, they are made up of a specialized group of investors and participants,” said Mr. Dholakia. He also stated that
There tends to be a lot of social influence in the buying behaviors. Potential investors often tend to look for other investors’ behaviors to decide if they should buy a particular cryptocurrency.