S&p crypto mega cap index

Wall St with cryptocurrencyINDICES

Skeptical investors with a lower risk appetite have always preferred indices to keep their funds secure or rather at a minimum loss threshold even if one of the assets goes spiraling. Therefore, in order to cater to the demands of such people and to attract more potential investors, S&P Dow Jones has launched an array of crypto indices.

These include S&P Bitcoin Index, S&P Ethereum Index, and S&P Crypto Mega Cap Index. Later this year, they also plan to add more indices to enhance the feasibility and attract more investors, particularly the younger people.

In case you are a newbie in the crypto sphere or you are unaware of the financial markets in detail, please note that an index refers to a collection of assets grouped together to produce an aggregate value.

S&p crypto mega cap index

We look forward to further expanding our new family of Digital Market Indices and bringing much needed transparency to this exciting market.”

In addition to the new S&P Digital Market Indices, S&P DJI also launched customized cryptocurrency indexing solutions at the end of last year. Since then in the first quarter of 2021, IDX Insights launched a series of risk-managed custom cryptocurrency indices – the first based on S&P DJI’s custom cryptocurrency indexing capabilities.

ABOUT S&P DOW JONES INDICES

S&P Dow Jones Indices is the largest global resource for essential index-based concepts, data and research, and home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®.
More assets are invested in products based on our indices than products based on indices from any other provider in the world.

S&p crypto mega cap index ticker

New York-based cryptocurrency data firm Lukka provided the “world’s first fair market value-focused” pricing methodology to price the S&P indexes.

This method of valuation is designed to align the crypto ecosystem to GAAP and IFRS guidelines, according to the indexes’ methodology document.

Why It Matters: Since the indexes measure price appreciation and not the current price of the underlying asset, comparing the two indices helps traders make an easy assessment of the better-performing asset over time.

For instance, at the time of writing the index showed that Bitcoin’s return over a one-year period was 558% as opposed to Ethereum’s one-year return, which was 1,477%.

“With digital assets such as cryptocurrencies becoming a rapidly emerging asset class, the time is right for independent, reliable, and user-friendly benchmarks.

S&p cryptocurrency large cap index

S&P Digital Market Indices. These new S&P-branded indices will measure the performance of digital assets listed on recognized open cryptocurrency exchanges.

At launch, the index series includes the following:

  • S&P Bitcoin Index – measures the performance of Bitcoin.
  • S&P Ethereum Index – measures the performance of Ethereum.
  • S&P Cryptocurrency MegaCap Index – measures the performance of Bitcoin and Ethereum digital assets.

Later this year, the S&P Digital Market Indices series will include additional coins and broader-based indices such as large cap and broad market benchmarks.

The indices use pricing data from Lukka, a crypto software and data provider, to determine the eligibility universe and pricing of individual constituents. S&P DJI’s Index Committee administers the indices.

S&p cryptocurrency bdm ex-large cap index

Once it’s deployed, it would be one of its kind solutions, particularly for a traditional organization to provide such extensive feasibility to cryptocurrencies.

Moreover, according to the Global Head of innovation and strategy at Dow Jones, the digital assets and traditional financial markets are not different from each other and organizations must provide such feasibilities to stay in the game and ensure their longevity.

In order to offer the functionality, Dow Jones plans to use the data provided by Lukka, which happens to be a virtual currency company based out of New York.

Since cryptocurrency has soared in popularity in the last few years and this bull run in particular experienced a major boom of institutional adoption, it is only going to take a few established investors going heavy on these indices before the rest of the public starts following the trend.

S&p crypto mega cap index

S&P DJI first announced new cryptocurrency asset index capabilities with Lukka in December 2020.

The market for cryptocurrency assets continues to grow and with that, investor demand for benchmarking and index-based solutions based on crypto and blockchain assets is more essential than ever. The Digital Market Indices will make it easier for investors to access and assess this emerging technology-driven asset class while potentially mitigating some of the common risks associated with this traditionally speculative market.

“Traditional financial markets and digital assets are no longer mutually exclusive markets,” said Peter Roffman, Global Head of Innovation and Strategy at S&P Dow Jones Indices. “As cryptocurrency becomes more mainstream, investors now have access to reliable and transparent benchmarks backed by institutional quality pricing data.

S&p crypto mega cap indexator

S&P DJI first announced new cryptocurrency asset index capabilities with Lukka in December 2020.

The market for cryptocurrency assets continues to grow and with that, investor demand for benchmarking and index-based solutions based on crypto and blockchain assets is more essential than ever. The Digital Market Indices will make it easier for investors to access and assess this emerging technology-driven asset class while potentially mitigating some of the common risks associated with this traditionally speculative market.

“Traditional financial markets and digital assets are no longer mutually exclusive markets,” said Peter Roffman, Global Head of Innovation and Strategy at S&P Dow Jones Indices. “As cryptocurrency becomes more mainstream, investors now have access to reliable and transparent benchmarks backed by institutional quality pricing data.

S&p crypto mega cap indexed

We look forward to further expanding our new family of Digital Market Indices and bringing much needed transparency to this exciting market.”

In addition to the new S&P Digital Market Indices, S&P DJI also launched customized cryptocurrency indexing solutions at the end of last year. Since then in the first quarter of 2021, IDX Insights launched a series of risk-managed custom cryptocurrency indices – the first based on S&P DJI’s custom cryptocurrency indexing capabilities.

ABOUT S&P DOW JONES INDICES

S&P Dow Jones Indices is the largest global resource for essential index-based concepts, data and research, and home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®.
More assets are invested in products based on our indices than products based on indices from any other provider in the world.

S&p crypto mega cap indexes

For instance, if the Crypto Mega Cap Index contains 20 cryptocurrencies, the user won’t have to invest in each of them to diversify the portfolio. In fact, he simply needs to invest in the Crypto Mega Cap Index and withdraw profits based on the aggregated movement of the index.

Therefore, if, out of 20 coins, only 5 lose 50% of the value while the other 5 retain their value, the overall value of your portfolio would only be affected to about 25%. Moreover, in case 5 coins climb the bull by 50% while the other falls off after bearish news by about 50%, your portfolio’s value will not change as the result of either would be complemented.

This is a part of the diversification plan sought by many institutions in the financial market and S&P has also embarked on a similar plan, which they announced last year.

S&P Digital Market Indices. These new S&P-branded indices will measure the performance of digital assets listed on recognized open cryptocurrency exchanges.

At launch, the index series includes the following:

  • S&P Bitcoin Index – measures the performance of Bitcoin.
  • S&P Ethereum Index – measures the performance of Ethereum.
  • S&P Cryptocurrency MegaCap Index – measures the performance of Bitcoin and Ethereum digital assets.

Later this year, the S&P Digital Market Indices series will include additional coins and broader-based indices such as large cap and broad market benchmarks.

The indices use pricing data from Lukka, a crypto software and data provider, to determine the eligibility universe and pricing of individual constituents.

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