Index Coop CoinDesk ETH Trend Index (cdETI)
An automated strategy token designed to take advantage of trends in the price of ETH by utilizing CoinDesk Indices’ Ether Trend Indicator.
Last updated
An automated strategy token designed to take advantage of trends in the price of ETH by utilizing CoinDesk Indices’ Ether Trend Indicator.
Last updated
cdETI is an automated strategy token powered by CoinDesk Indices’ Ether Trend Indicator (ETI). It is designed to take advantage of ETH’s price momentum without the need for constant market monitoring and active trading.
Objective
CoinDesk Indices’ Ether Trend Indicator is a set of dynamic signals designed to convey the presence, direction, and strength of momentum in the price of ETHt. The trend indicator is calculated and published daily and derived from historical daily levels of the underlying reference price index (“Underlying Index”) for ETH, as detailed in their methodology document.
The Ether Trend Indicator will have one of five possible daily values, with each value corresponding to an indicated direction and strength of trend in the price of the underlying digital asset.
Highlights
The family of Trend Indicators was created by CoinDesk Indices (“CDI”) and launched in March 2023. These methodologies were created by CDI to achieve the above-stated objective. There may be circumstances or market events that require CDI, in its sole discretion, to deviate from or amend these rules to ensure each Trend Indicator continues to meet the Objective.
Backtesting conducted by Index Coop discovered an adaptation of the methodology that resulted in higher historical returns and less trading volatility within the token.
This backtesting found that a less frequent, automatic rebalancing strategy generally led to higher returns over time and less volatility of the product. Users should conduct their own performance assessments of the token and potential methodologies. The Index Coop does not offer financial advice or guarantee performance.
CoinDesk’s Ethereum Trend Indicator has five possible values: Significant Uptrend, Uptrend, Neutral, Downtrend and Significant Downtrend. The Index Coop tested several ways to allocate to ETH and USDC, respectively, according to the ETI and had the results validated by a third party. The strategy with the best historical performance, lowest volatility, and fewest rebalances was when the Uptrend and Downtrend were treated as Neutral. In each of those cases, the product would be equally weighted between ETH and USDC. In the case of a Significant Uptrend or Significant Downtrend, the product would be 100% allocated to ETH or USDC, respectively.
Drop into the Index Coop Discord Server and get in contact with us. This is the fastest way to have a real person answer any questions you have.
| Trend | ETH Trend Indicator | ETH Allocation | USDC Allocation |
|---|---|---|---|
Significant Uptrend
1
100%
0%
Uptrend
0.5
50%
50%
Neutral
0
50%
50%
Downtrend
-0.5
50%
50%
Significant Downtrend
-1
0%
100%
