oinMarket Cap Simulation Project and Term Paper
As you already know, cryptocurrencies are full of risk, and they are volatile, too. Trading in them may result in the loss of capital-and without the basic skills, those losses will be greater than they need to be.
Throughout this course, you’ll improve your skills by playing a CoinMarket Cap Simulation, a free trading cryptocurrency simulator that helps teach you how to trade in cryptocurrencies and altcoins. You’ll improve your trading capabilities for the future, when you may trade on a real cryptocurrency exchange.
You’ll play the CoinMarket Cap Simulation from Week 1 to Week 6, updating and submitting an Excel spreadsheet each week. In Week 7, you’ll write a term paper outlining the decisions you made, your reasoning behind those decisions, and what you learned.
Please download this file and save or print it for reference throughout this course.
Setting Up the Coin Market Cap Portfolio Simulation
At the beginning of Week 1, open an account at download the Weekly CoinMarket Cap Simulation Tracker Excel spreadsheet in the Content I Syllabus area of the classroom.
Title the spreadsheet Week1_CoinMarketCap_[YourName]. You’ll retitle it every week.
Open a free CoinMarket Cap account at https://coinmarketcap.com/. This will involve entering your name and email address. Now imagine that you start with $20,000 fictional dollars and create a portfolio.
To diversify your cryptocurrency portfolio invest in five cryptocurrencies.
For further background and history of the various cryptocurrencies, visit the Coin Market Cap site to see the biggest gainers and losers in the market see https://coinmarketcap.com/gainerslosers/. For information about the five cryptocurrencies other than bitcoin refer to https://www. warriortrading. com/top-5-cryptocurrencies-other-bitcoin/
Weekly Submission Instructions (every Tuesday, Week 1 through Week 6)
Time Estimate: Plan on spending about 30 minutes on the simulation each week, this includes research, updating your spreadsheet, and making you are submitting your Excel Tracker.
Deadline: Tuesday of each week. (You’ll receive your grade for this data collection after Week 7, once you submit your term paper.)
Starting Week 1, conduct at least one transaction per week.
During the week, you may want to monitor the value of your cryptocurrencies to determine if you want to sell a cryptocurrency that is losing value. Keeping a weekly record can help you plan your next trade.
On the spreadsheet, record your purchases, sale, and exchange of cryptocurrencies. When thinking about real-world trading, please consider the trading fees. These can significantly affect your overall profits and losses.
Do not erase any record of the cryptocurrency you sold. Just add a line for the new cryptocurrency you are purchasing.
Before submitting your spreadsheet each week, update the title to reflect the current week number: Week[X]_CoinMarket Cap_[YourName].
Every Tuesday, submit your spreadsheet, which will show your updated portfolio value and portfolio change. The timeliness of your submissions is factored into the total project grade.
Final Transaction
At end of Week 6, sell your cryptocurrency portfolio. Update and retitle your spreadsheet one final time. The spreadsheet will calculate the value of each cryptocurrency, the portfolio value, and the change of portfolio value. This is your final spreadsheet submission.
A Few Tips for Playing the Simulation
As stated at the beginning of this document, you’ll want to invest in at least five cryptocurrencies. Diversification enables you to lower your exposure risk as well as improving your risk-adjusted return.
Consider spending the entire $20,000 over the course of the six weeks.
Safeguard your capital. Set an acceptable limit for losses so your capital is safe. Here is an example: If you bought Bitcoin at $9,000 US, set a mental loss limit at $8,900 in advance and mark it on your Excel tracker. If Bitcoin drops to $8,900 then sell, the loss does not exceed $100. You can also use a percentage limit, such as 5% below the purchase price, to determine when you should sell.
Week 7 Term Paper
Write about your experiences trading with the CoinMarket Cap trading simulator. Your paper should be no longer than three pages (about 900 words). Include a cover sheet and, if appropriate, a references page. Format your paper in accordance with the APA style manual (7th edition). The following outline is an example of how you might organize your paper:
Cover Sheet
Executive Summary
Content
What decisions you made and the rationale for those decisions
What factors prompted you to action when you …
bought?
sold?
made an exchange?
Conclusion
Results of your cryptocurrency portfolio
What changes had the greatest impact?
Lessons learned: If you had to do it all over again, what would you change?
By the end of Week 7, submit your term paper to the Weekly Submission: CoinMarket Cap Simulation Project and Term Paper Assignments folder
