How do we compute the NetCurrencyIndexes ?
The market of digital cryptocurrencies can not be measured by the standards. we know from the usual financial markets.
The rapidly evolving market, with its steady changes, also requires responses that match the pace of development.
We are now living through a blockchain revolution
The Natural calculation basis of the individual Indexes NCI 30, NCI 100, NCI 500 is owed. On the one hand to the far-reaching market capitalization of the cryptocurrencies in the indexes on the other hand. Also due to the requirements of the market itself. The calculation formula makes the various Cryptocurrecies directly comparable. Shows the development of the various indexes and the development of the cryptocurrencies contained in them.
In the calculation basis of the NCI 30, NCI 100 and NCI 500. Which is mainly ranked by marketcap the dominance of Bitcoin is therefore negligible and is not particularly weighted.
Crypto currencies have been and are being issued and the number is increasing by mining additional cryptocurrencies. As well as, if not subject to mining, often by the additional issuing of a number of other smart contracts. This is the special feature of the Crypto market. There are constantly changing factors,with constantly new participants coming to the market which in turn rapidly change existing fundamentals substantially. Up to now, other Markets have not known this.
However, the calculation of an index of the cryptocurrencies contained in it, which gives an overview of the rapidly developing market, can not be calculated on the basis of the value of the market capitalization only. Although the market capitalization reflects the acceptance in the market of a single cryptocurrency. It is not suitable for giving up, or sharing-constantly changing market conditions. This is not because the prices of the individual crypto currencies are often in great disproportion to the number of circulating crypto currencies.
The use of apparently interesting mathematical formulas for the calculation of crypto currency indexes brings us here not further, including the applied bases of calculation of Russel or Lafayette such as the well-known Dow Jones Index or S & P 500, the DAX, the IBEX 30 the China 100, the Japan 100, or others. The NCI 30, NCI 100, NCI 500, as well as all other future Indices will only be calculated on the basis of the average percentage changes in the prices of the individual crypto currencies. Reflecting the real changes in the world of Cryptocurrencies in the Indices.
In our NCI 30, the strongest 30 Cryptocurrencies are included after marketcap. The NCI 100 contains the strongest 100 crypto currencies and in the NCI 500 the strongest 500 after marketcap.
Every 5 minutes these are adjusted according to marketcap so they are updated automatically all the time and show the real, fully natural market circumstances which happened at last on all international Crypto Exchanges for each Crypto currency.
How do we weigh?
The index is calculated in realtime. All values refer to the close of the previous day, considered to be at 00:00 UTC.
Not too surprisingly, the index is a much better investment vehicle than Bitcoin itself. We have evaluated the performance of the NetcurrencyIndices since the beginning of August 2017. Today (June 2018) Bitcoin is up by about approx. 80% . The Netcurrencyindices are up by approx. 100.5% to 300% because the other cryptocurrencies have actually done much better than Bitcoin, with a higher Sharp ratio. Therefore, investing in the index allows investors to profit from the unforecastable raise of some cryptocurrencies, while limiting the losses deriving from the fall of others.
The Netcurrencyindices are the most accurate instrument for measuring the whole cryptocurrencies market, and the Blockchain sector in general. It represents a useful tool for investors, a benchmark for traders and asset managers, a replicable index for passive funds and ETF’s. In short, it is the industry standard for cryptocurrencies.
If a current price for any Cryptocurrency, which is in our NetcurrencyIndex is not available, or no longer on the market, then we will show the next Cryptocurrency with the highest market capitalization and include this in our data calculation.