Let’s Talk About Indexes and Why It’s Important for Digital Assets
Why are Indexes, like the VIX, extremely important for Digital Assets, like Bitcoin?! VegaX shares key research on traditional and digital markets #volatility.#BTC #VegaX #VBIX!
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Traditionally and widely used in the stock markets, an index is a measure of a specific section of the stock market. Each index typically comprises different baskets of stock which are weighted (typically as a weighted average) in order to arrive at a viewpoint on the broader market, which is then utilized to compare returns to specific investments or strategies.
Within the financial markets, indexes play a very critical role in the analysis of the overall markets. Indexes and their respective movements typically provide great insight into the overall economy, investing patterns in the markets and potential trends for investment diversification.
While the digital asset and cryptocurrency industry is still in its early phases, it is critical that this type of data becomes available as more strategies become available and diversification grows in importance. Indexes are critical in providing benchmarks, but also in providing an industry wide transparent method by which to objectively analyze different strategies. Indexes provide a central guide or benchmark by which to create new strategies for a broader audience with lower costs, but also pricing data that can be used by everyone participating in the industry. The proliferation of these indices will ultimately drive more adoption, but also create lower costs for investors across the industry.
With this in mind, VegaX is developing unique and proprietary indexes that will allow for potentially enhanced returns and better portfolio diversification as the industry continues to mature. Around these indexes VegaX is also providing a suite of index-based strategies and products that allow digital asset holders to generate income or enhance their positions with unique strategies that are not as easily accessible today. One of the first strategies that VegaX is launching is the Enhanced Bitcoin Exposure (“EBE”) Strategy. This strategy is intended to provide Bitcoin holders with current income and moderate downside protection by selling options on the core BTC holdings. Usually within the traditional markets and more mature industries, pricing in the market is priced relatively accurately. However, within the digital asset industry, current market conditions allow for large premiums to be taken advantage of to generate income. For more details on the EBE strategy, visit here and for more information on VegaX, visit our website.
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