Portfolio Performance: January and February (increased Dash, exited Zcash)

This is the first in a series of regular posts where I plan to share the details of my portfolio, the trades I’ve made (if any), and observations on market performance.

Here’s what I currently own in the world of cryptoassets (a semi-regular update is also posted here):

  • Bitcoin: 87%
  • Ether: 7%
  • Dash: 4%
  • Monero: 1%
  • Litecoin: 1%

Here are the trades I made in January and February:

  • I sold my entire Zcash position – about 1% of my portfolio; it’s still a promising technology and team, but given coin inflation and past performance Zcash price is not likely to beat Bitcoin
  • I increased my Dash position from 1% to almost 4%; I also contributed some of my shares to a Dash Masternode share program and may even setup my own Dash Masternode at some point
  • When Bitcoin neared its all-time high at $1200 I sold less than 5% of my Bitcoin holdings. I did this because I had promised myself, during the long extended bear market, that if Bitcoin ever reached its ATH I would take some profits. Even then, I didn’t take as much off the table as past-me had promised myself. Funny how psychology works
  • I slightly increased my position in Monero although I am starting to suspect it won’t outperform Bitcoin in the next 12 months

Portfolio benchmarks:

  • In calendar year 2016, Bitcoin increased 137%. My portfolio returned 107%, so I underperformed significantly
  • In January 2017, Bitcoin fell 5%. My portfolio lost 2%, so I outperformed slightly

I’ll eventually draw up a table to compare my portfolio’s performance versus Bitcoin and other benchmarks, eg, the S&P 500 and a Gold ETF.

What I’ve learned:

I’m of the increasing suspicion that currencies favored for transactions (eg, Ethereum as gas, Monero, Zcash) will underperform currencies that exhibit store-of-value / buy-and-hold properties (eg, Bitcoin, Dash with its Masternode structure). It may be hard to predict ex-ante coin behavior. I will look at transaction metrics (volume and dollars moved) and measures of a currency’s velocity to see if there is some correlation

I’ll publish at least one of these posts every month. If you want more frequent updates, subscribe to my investment newsletter below. Thanks, happy investing!

If you enjoyed this essay, here’s a list of the assets I own and the ones I’ve researched. Find me on Twitter and signup on the right to receive an update when I publish a new essay.