The Digital All-Weather Portfolio strategically allocates capital across a diversified range of alternative digital asset strategies, managed by industry leading portfolio managers. The AMC pursues the following investment strategies: directional/long-biased, long/short, quantitative, relative value and event driven. These strategies are designed to capture diverse alpha opportunities, mitigate risks, and enhance returns.

The portfolio strategies applied by the target portfolio managers will include:

Long Biased

Long-biased strategies involve managers investing mainly in liquid, established tokens or early-stage projects. The goal is to generate returns by capitalizing on the growth potential of the cryptocurrency market while keeping a predominantly long exposure. Managers may use discretionary or systematic methods, relying on fundamental and technical analysis to guide their decisions.

Long/Short

Long/short strategies buy undervalued digital assets and sell overvalued ones to capitalize on market mispricing. This strategy takes advantage of the high volatility and rapid price movements in cryptocurrency markets to generate returns while managing risk. Managers aim to profit by going long on assets expected to increase in value and shorting those expected to decrease. They use both long-term and short-term strategies, including trend following and momentum trading, and may invest in a range of digital assets, from major cryptocurrencies to emerging altcoins. To hedge their positions, they may use derivatives like options and futures.

Quantitative

Quantitative strategies utilize advanced mathematical and statistical models when making investments. These strategies can be directional or non-directional, aiming to exploit market inefficiencies through systematic analysis and automated trading. Managers develop algorithms to analyze large datasets and identify opportunities, often incorporating machine learning and artificial intelligence to enhance accuracy and optimize execution. The goal is to achieve consistent, high-frequency gains while mitigating risk through precise model calibration and continuous performance monitoring.

Relative Value

Relative value arbitrage strategies focus on exploiting mispricing between related digital assets to generate returns uncorrelated with the broader market. Managers use various arbitrage techniques, such as funding rate arbitrage (taking advantage of differences between perpetual swaps and underlying assets), basis arbitrage (profiting from the spread between spot and futures prices), statistical arbitrage (identifying short-term pricing inefficiencies), and volatility arbitrage (capitalizing on bid-ask spread differentials). This strategy aims to maintain a market-neutral position while profiting from price discrepancies and market inefficiencies.

Event Driven/Special Situations

Event-driven strategies capitalize on specific events and special situations within the cryptocurrency market. Managers target opportunities created by regulatory changes, technological advancements, market anomalies, and macroeconomic shifts. These events can lead to opportunities in lending markets (CeFi and DeFi), staking, and other strategies leveraging digital asset infrastructure. The goal is to exploit inefficiencies arising from these situations to generate asymmetrical returns.