Top 7 Crypto Gems Based on Sharpe Ratio

This analysis identifies the top 7 cryptocurrencies based on their Sharpe Ratio, a measure of risk-adjusted return. Here’s a brief explanation of the metrics used:

• Total Return: This is the percentage change in the price of the cryptocurrency from the start date(2023-01-01) to the end date(today). A higher total return indicates better performance. For example, a total return of 1.50 means the cryptocurrency has increased by 150%.
• Volatility: This represents the standard deviation of daily returns annualized. It measures the risk or the extent of price fluctuations. A higher volatility means higher risk. For example, a volatility of 0.50 means the annual standard deviation of the daily returns is 50%.
• Sharpe Ratio: This is the ratio of the total return to the volatility, indicating the return per unit of risk. A higher Sharpe Ratio is preferred. For example, a Sharpe Ratio of 2 means the return is 2 times the volatility.

The cryptocurrencies are ranked based on these metrics to identify the best-performing ones with the least risk.