On May 23rd, 2018, the Huobi Pro Exchange has officially announced the establishment of a new crypto-currency index, which will be known as Huobi 10 index. As its name suggests, the Huobi 10 index will include the 10 top-rated digital assets in relation to both the market capitalization value and the situational liquidity. The list includes Bitcoin, Huobi Token, EOS, Ethereum, Bitcoin Cash, XRP, LTC, IOST, Ethereum Classic, and Dash.
The digital assets, on the basis of which the crypto index is calculated, are classified into four categories:
Coin
Platforms
Applications
Utility Asset tokens
The assets included in these categories are selected according to the volume of transactions for the previous quarter. The weight of each component of the crypto index is calculated based on the average daily trading volume in the previous quarter.
Eight of the coins listed are familiar to many and are leading of the top-10, however, there are two notable entries, the inclusion of which may indicate bigger things to come. Huobi Token is the native token of the Huobi Pro exchange, and has experience of a similar increase in popularity of the Binance coin, as Huobi gets visibility and a greater market share. IOST (Internet of Services Token) is another newcomer and was the first project to be incubated by Huobi labs. It is a platform coin that has taken significant steps over the past few months, signaling its capability to compete with other major dApp platforms.
As noted in the message of the exchange, their own development index has been compiled taking into account the classification of assets and using the weighted average method of calculation.
The main function of the index is to correctly represent the performance of USD Tether (USDT) pairs on the Huobi cryptocurrency exchange. New indices are also planned to be released in the near future in order to offer investors a variety of indices options. These indices will provide investors with a clear snapshot of specific market segments, as well as means for comparison.
What is the advantage of the platform? The index will reflect the overall performance of Huobi Pro market. As a result, the clients of crypto-exchange will be able to identify the most liquid assets traded on Huobi.pro, and will not have to check the rates of individual crypto-currencies. Assessing the overall performance of the digital assets that are traded against USDT on Huobi Pro, HB10 will allow traders to diversify their portfolios, track their trading performance and the market more efficiently.
Exceptional Performance of the Huobi 10 Index
The Huobi 10 index scored well when put up against Bitcoin during the testing. According to the statistics captured from March to May 2018, the alpha of Huobi 10 Index scored -0.0028 against BTC, while the beta version got 0.79. This testing indicates that the Huobi 10 Index can inhibit market volatility and, at the same time, effectively maintain its alpha.
Market Maturity
For a long time, the crypto-space has been trying to introduce a market index. Nevertheless, the launch of the Huobi 10 index occurs on time, as the market is fully mature and ready for such a product. For example, MSCI and S&P500 indices helped portfolio managers in benchmarking. Without a doubt, the Huobi 10 index will be successful, considering that it encompasses and covers many digital assets. In addition, it is made using advanced technology that graced conventional composite indices.
Further Plans
According to the Huobi team, this is the first of many indices that the platform will create. In the future, there will be a wide range of indices from which the traders can choose. With the help of these indices, investors will have an in-depth understanding of specific divisions in the crypto space. Moreover, the lists will useful when comparing the performance of various digital assets. As a result, the investors will make informed investment decisions, which will lead to increased profits.
Primarily, the Huobi 10 Index will have the base point of 1,000. Later, it will be represented on the world-famous financial platforms, such as Bloomberg. In addition, Huobi intends to obtain future financial performance for the Huobi 10 index. In this regard, the first subsidiary will be HB10, which is planned to be released in June 2018. Future financial derivatives are planned to be released based on Huobi 10 Index.
Overall, Huobi 10 Index is one more step towards the legitimacy of the crypto world, which signals an approaching wave of similar indexes from other major exchanges, as they claim to be the first.
You can sign up and view the Huobi10 Index in real time. Calculated and updated every 15 seconds, HB10 is the true real-time and comprehensive view of the crypto market.