It has been nearly 125 years since Charles H. Dow created the first financial index in 1896. Dow, a finance journalist, co-founded the Dow Jones & Company and founded The Wall Street Journal, a publication that has featured more than its fair share of indices over the past several decades. There are indices that cover the declining number of traditional physical retail stores in the United States. There are indices that track Chilean wine prices. There’s of course the world-famous Big Mac Index that was created by The Economist in 1986 to quantify the theory of purchasing power parity (PPP) by tracking the cost of hamburgers in different countries. There are now literally at least tens of thousands of unique indices and index concepts around the world.
CryptoDaily is pleased to announce that it has recently joined the rank and file of companies that provide specialist indexing data. Our inaugural three indices include The CryptoDaily Large-Cap Cryptocurrency Index, The CryptoDaily Mid-Cap Cryptocurrency Index, and The CryptoDaily Small-Cap Cryptocurrency Index. There are more than 2,000 cryptocurrency unique digital assets in the cryptocurrency markets, and our inaugural three cryptocurrency indices cover approximately 96.9% of the total market capitalisation listed on CoinMarketCap.com, among other places.
The reference values for the CryptoDaily Large-Cap Cryptocurrency Index, The CryptoDaily Mid-Cap Cryptocurrency Index, and the CryptoDaily Small-Cap Cryptocurrency Index begin in late 2016 and are published daily on an end-of-day basis on CryptoDaily’s website. We deemed this to be a good starting point because many of the constituent assets listed in these first three indices did not exist before 2016. Each index has an animated chart that permits user-defined interactivity, and CryptoDaily transparently details the index composition methodology for each sponsored index that it publishes.
We retained the services of indeXcel, a specialist index construction company, to design, create, and calculate the proprietary cryptocurrency indices that CryptoDaily now sponsors. Given the highly technical nature of blockchain technology, it is challenging for many industry participants to comprehend the subtle nuances across the wide spectrum of cryptocurrency assets.
Our indices are designed to increase market transparency, simplify performance measurement, engender diversification and risk management, and facilitate decision-making. The intention is for CryptoDaily’s sponsored indices to serve as information aggregates, reference values, and eventually benchmarks for the cryptocurrency markets. We believe our first three cryptocurrency indices will provide unique content for a long time. We may even get lucky and find that one or more of our cryptocurrency indices becomes an industry benchmark.
The role of indexing in the capital markets has taken on additional significance over the past twenty years as active investment management strategies have consistently lagged passive strategies across many asset classes for myriad reasons. We aim to address the obvious knowledge gap by publishing calculable indices daily – each of which reflects a different approach and has a different objective. We aspire to produce price and value discovery through the reliable publication of these indices, and endeavour for these to become industry benchmarks. Our indexing road map is quite detailed, and the industry will soon find these first three indices complemented by additional unique offerings.
Our loyal readers and viewers have already expressed overwhelming satisfaction with this new feature, and we are appreciative of this feedback. We thank you for this encouragement as we continue to sponsor unique index content. We will provide regular content related to our indices, and hope that this content will provide some unique context about the cryptocurrency markets.