Automated Portfolio Management refers to the systematic and technology-driven process of constructing, rebalancing, and optimizing crypto asset portfolios based on predefined investment objectives and risk tolerances. Its purpose is to provide efficient, consistent, and scalable management of digital asset allocations.
Mechanism
This process involves specialized software platforms that leverage algorithms to monitor market data, execute trades, and adjust portfolio holdings according to models like modern portfolio theory or quantitative strategies. It connects with crypto exchanges and custody solutions, often using APIs for order placement and asset tracking.
Methodology
The strategic approach involves establishing clear asset allocation rules, defining rebalancing triggers, and setting risk limits that guide the algorithms. This aims to maintain desired portfolio characteristics, capture market opportunities, and manage risk exposure systematically across various digital assets and derivatives.
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