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The Risk Rebalancer* uses our proprietary volatility metric, the Volatility Quotient (VQ), to allocate more capital to less volatile cryptocurrencies and less capital to your more volatile cryptocurrencies.

The Risk Rebalancer takes a portfolio of cryptocurrencies and re-balances available capital among them.

To access the Risk Rebalancer, please take the following steps:

  • Click the Research tab (1) in the main menu at the top of the page.
  • Click the Risk Rebalancer (2) in the submenu. The following page will display:

risk rebalancer

Here are the options before you balance:

  • Select a single portfolio from the drop down list (3). You can also select all or multiple portfolios by clicking on the different portfolio titles.
  • Total Value(4) is a sum of the value of all the cryptocurrencies in the portfolio.
    • This amount may include your cash. This is the amount that will be rebalanced across all your cryptocurrencies.
  • Current Cryptocurrencies (5) is the sum of the value of all cryptocurrencies in the portfolio — not including cash .
  • Include Cash (6) can be checked if you would like to allocate your cash to the rebalanced portfolio. You can edit this value with the Pencil Icon.
  • Finally, click Rebalance (7).

Tip: The biggest value of the Risk Rebalancer is in identifying unbalanced position sizes. This may include large position sizes in very volatile cryptocurrencies or small position sizes in low volatility cryptocurrencies.

After clicking Rebalance, you will see the results.

The results are broken into three sections:

  • The Rebalance Overview (1) — summary of results
  • The Rebalanced Results (2) — details on which position changes occurred
  • Steps to Take (3) — a quick look at what steps you would need to take to achieve the Overview Results
Rebalance Overview:

Risk Rebalancer Results

This page shows you a basic overview. It displays your current PVQ and how rebalancing would impact that. It also shows you what your risk per position could be and how your risk is allocated.

Rebalanced Results:

The results view will shows you what the Rebalancer did. It also allows you to tailor the results to your specific situation. It allows you to “Lock” (1) positions that you would like to keep in the rebalance calculations but not adjust the units of, remove (2) positions completely from the rebalancer calculations, or add new symbols (3) to the calculations. Make sure to Update Results (4) if you make changes.

Rebalanced Results

The columns shown in the results are:
  • Actions: Allows you to lock or remove positions
  • Symbol: The symbol for your cryptocurrencies
  • CSI Status: your position’s current Crypto State Indicator
  • VQ: Current Volatility Quotient (VQ%) for the cryptocurrencies
  • Latest Close: Latest Close price
  • Position Size (dollar value): Amount of money invested in each position
    • Current Size
    • Rebalanced Size
  • Position Size (Percentage): The percentage that each position represents in the portfolio(s)
    • Current Size
    • Rebalanced Size
  • Risk % per position: The percentage of risk of each position in comparison to the rest of the portfolio(s)
    • Current Size
    • Rebalanced Size
  • Units: Number of Units in each position
    • Current Units
    • Rebalanced Units

 

Steps to Take:

steps to take

The final portion of the Risk Rebalancer is the Steps to Take. This is a clean view to quickly show you what would need to be done to achieve the equalized risk adjustment to your portfolio(s) should you choose to implement this rebalancing strategy.

You can Save this as a New Portfolio (1) in CryptoTradeSmith, Export to Excel (2), or Print (3) a Hard Copy from this page.

*Note: A Premium or above account is required for this tool.