The Entry Portfolio
Over the past six months, we have dedicated significant time and resources to refining the high-potential growth segment of our portfolio.
When considering projects for inclusion in our portfolio, we prioritize two primary factors: a high level of certainty regarding their relevance over the next decade and their potential for substantial growth.
Market timing update.
The market has been following the projected trajectory outlined in our previous articles, and TOTAL3 is on the verge of entering the entry plan zone that was outlined approximately 45 days ago.
In this article, we are not making any new short-term market projections as the current situation remains unchanged, and our models still indicate a bearish sentiment.
The AMC (Actively Managed Certificate) is nearly ready, and we will share all the necessary details in the upcoming update. Once the update is provided, we will shift our focus solely to execution, especially if market conditions intensify.
Leveraging Ethereum.
We firmly believe that the upcoming market cycle will be dominated by the Ethereum ecosystem. In line with this view, our largest investments are directed towards top-tier applications that leverage Ethereum technology.
Cross-chain Exposure.
While we expect the Ethereum dominance to grow, we recognize the potential of a diverse multi-chain landscape. Consequently, our portfolio includes investments in what we believe to be the most promising nascent Layer 1 blockchain protocols.
Segments of investments.
Our investments are all picked with a vision on next cycle's biggest trends. But most importantly, we use two principal segments for further filtering down our selection.
- High certainty: Certain projects possess fundamentals (typically a robust interdependence with its ecosystem) which renders them resilient.
- High-growth potential: Decentralised protocols often provide the opportunity to invest at a relatively early stage of their development.
As part of our research process, we make use our ERC20-screener to help us detect strong fundamentals early, including user adoption & retention, revenues & profits, supply distribution and issuance.
Projections
By separating altcoins in market cap ranges (<1B$, <1B$, <100M$), we can model their performance distribution relative to Ethereum with higher precision.
Assuming each group follows a normal distribution with mean μ and standard deviation σ, where μ and σ are given as follows:
Let X, Y, and Z be random variables representing the performance of Ethereum applications with market capitalizations greater than 1 billion dollars (1B$), less than 1 billion dollars (<1B$), and less than 100 million dollars (<100M$), respectively, relative to the performance of Ethereum.
The raw performance of our long-term portfolio, denoted as random variable P, can be represented by:
Since P is a linear combination of normally distributed random variables, we obtain:
As a conclusion, by combining diverse risk-reward profiles, we get a portfolio with enhanced expected returns and narrower confidence intervals.
These performance distributions model our portfolio's performance relative to Ethereum, without considering market timing.
Anaideia.
