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How does absolute return apply to the world of digital currencies?

avatarMarmikDec 16, 2021 · 3 years ago3 answers

Can you explain how the concept of absolute return is relevant in the context of digital currencies? How does it work and what are its implications?

How does absolute return apply to the world of digital currencies?

3 answers

  • avatarDec 16, 2021 · 3 years ago
    Absolute return in the world of digital currencies refers to the measure of an investment's performance without comparing it to any benchmark. It focuses on the actual return generated by the investment itself, regardless of the market conditions. This concept is particularly important in the highly volatile and unpredictable cryptocurrency market, where traditional benchmarks may not accurately reflect the true performance of investments. By considering absolute return, investors can evaluate the success of their digital currency investments based on their own objectives and risk tolerance, rather than relying on external market factors. It allows for a more personalized and independent assessment of investment performance in the digital currency space.
  • avatarDec 16, 2021 · 3 years ago
    When it comes to digital currencies, absolute return is all about looking at the actual gains or losses of an investment, rather than comparing it to a benchmark or index. This is especially relevant in the world of cryptocurrencies, where the market can be highly volatile and traditional benchmarks may not accurately represent the performance of individual investments. By focusing on absolute return, investors can better assess the success of their digital currency investments based on their own goals and risk tolerance. It provides a more realistic and personalized evaluation of investment performance in the digital currency landscape.
  • avatarDec 16, 2021 · 3 years ago
    In the world of digital currencies, absolute return is a key concept that allows investors to evaluate the performance of their investments without comparing them to any specific benchmark. This is particularly important in the cryptocurrency market, where traditional benchmarks may not capture the unique characteristics and dynamics of digital assets. Absolute return takes into account the actual gains or losses of an investment, providing a more accurate measure of its success. It allows investors to assess the performance of their digital currency investments based on their own objectives and risk appetite, rather than relying on external benchmarks that may not accurately reflect the true potential of cryptocurrencies.