From The Fund Manager
This week though starting off slow, we had some big moves from the major crypto-currencies later in the week pulling us into decent profit levels. It wasn’t the bull market everyone was hoping for, but it was movement none the less and that is exactly what we needed to finish off the week nicely.
I would first like to apologise to the investor community and also thank our excellent team for taking on so much extra work and responsibility this week. The reason for my apology is due to us falling behind schedule with our tasks and my lack of presence in the Telegram chat. Unfortunately, I have had to reduce my duties whilst recovering from a fall down a staircase. I was still able to monitor our trading remotely, but all other responsibilities fell on our other team members. I particularly want to recognise Mike Pomery and Chris Yap for stepping up to the plate and pushing Countinghouse past this hurdle. In saying that, despite the team’s hard work, we have fallen behind on a few tasks. Our vlogs and blogs have been at a standstill and progress on the audit has slowed as I am still directly handling this matter. I thank the investor community in advance for their understanding of this unexpected speed bump.
On a positive note, we have had some excellent results in both small live testing and back-testing on Ripple (XRP/USD). The huge moves in XRP of late make it a very promising candidate for a new pair for the fund to trade. Once we have fully tuned our algorithms for XRP, we can run a full scale live test before implementing into the fund’s trading mix. Once the tuning stage is over, we will share our findings from back-testing and small live tests and show you how that is likely to affect the current mix in the fund as far as performance and risk are concerned.
There has been an increase from both crypto and fiat investors in the buyback queues and we are noticing that this current method still leaves opportunities for arbitraging the fund, which is undesirable, but for now we exploring some additional ideas. The fiat buybacks are invisible unlike transactions on ForkDelta as there is no public ledger available. Lately, our internal ledgers have also seen an increase in buyback requests. Once we have an audit published, this information will more visible for the entire CHT community.
Once again, thank you for your patience this week. I will be back in greater capacity next week and until then, have a safe and happy weekend.
Please take the time to review the report. It has been a great trading week!
Market Activity Snapshot
Weighted Average: 0.003854381 ETH or USD$0.76 per CHT
Non-Weighted Average: 0.003745095 ETH or USD$0.74 per CHT
Valuation – Jae Jun Method
Fundamental value (sometimes referred to as intrinsic value) is a calculation to determine the actual value of a share, unit or in this case a token when looked at as an investment.
We have chosen the Jae Jun Intrinsic Value Formula. The main reason we like the Jae Jun is because it is one of the most conservative calculations there is.
Now we have kept to how this is traditionally used and that is to base it on a 10 year return, factoring in the yield reducing over time. We have also taken an extra step to be even more conservative on this calculation; Jae Jun reduced the ‘no growth PE ratio’ from 8.5 to 7 but due to the increased volatility in the crypto market we think it is more prudent to reduce this value all the way to 1 (this value operates as a multiplier in the calculation so reducing it to one is very significant in the results the formula we return).
Credit: Photo by Worldspectrum