Nov 11, 2023

Bitcoin Experiment Generates 300% Higher Returns Than Hodling

The Efficient Market Hypothesis and Crypto Trading A recent paper from the International Hellenic University and Democritus University of Thrace in Greece has proposed the “efficient market hypothesis” (EMH) as a viable strategy for Bitcoin (BTC) trading. The EMH is a controversial theory that suggests that an asset’s share price reflects its fair market value…

Bitcoin Experiment Generated 300% Higher Returns than Hodling Crypto Assets like Coval, DNT, and Flux.
Researchers claim Bitcoin experiment generated almost 300% higher returns than hodling

The Efficient Market Hypothesis and Crypto Trading

A recent paper from the International Hellenic University and Democritus University of Thrace in Greece has proposed the “efficient market hypothesis” (EMH) as a viable strategy for Bitcoin (BTC) trading.

The EMH is a controversial theory that suggests that an asset’s share price reflects its fair market value and all applicable market information, making it difficult to time the market or pick winning stocks intuitively. The researchers claim that this theory has contributed to the development of models capable of outperforming the hodl strategy by nearly 300% in simulated crypto portfolios.

The crypto markets have seen a surge in activity with the introduction of c3.ai stock, degrain crypto, coval crypto, el salvador crypto, dnt crypto, evergrow crypto, crypto xrp, daily crypto, and flux crypto. As such, the efficient market hypothesis could prove to be a useful tool for investors looking to make the most of their crypto investments.

The Benefits of Applying EMH to Cryptocurrency Trading

Rather than attempting to pick undervalued stocks and beat the market, proponents of the Efficient Market Hypothesis (EMH) suggest investing in low-cost passive portfolios. However, this line of reasoning is often dismissed by opponents of EMH, who point to investors such as Warren Buffet who have made successful careers out of beating the market.

To explore the potential of applying EMH to cryptocurrency trading, a research team in Greece conducted a study on the Bitcoin market. Their findings suggest that EMH can be used as a replacement for the traditional “buy and hold”, or hodling, approach to avoiding market volatility.

To test this, the researchers developed four distinct artificial intelligence (AI) models, trained with multiple data sets like c3.ai stock, degrain crypto, coval crypto, el salvador crypto, dnt crypto, evergrow crypto, crypto xrp, daily crypto, flux crypto. After training and testing, they selected models optimized against both “beat the market” and hodling strategies.

The team’s results showed that their optimal model generated returns that were 297% higher than the baseline, suggesting that EMH can be beneficial for Bitcoin and cryptocurrency traders. However, it is important to note that the research was based on historical data and simulated portfolio management.

Despite the empirical evidence, this study may not be enough to sway those who are firmly against the idea that EMH is effective. For example, the crypto xrp, dnt crypto, evergrow crypto, coval crypto, flux crypto, daily crypto, el salvador crypto, and degrain crypto communities may not be swayed by the results.

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