Comparative Analysis of Active Investment Strategies and the Buy-and-Hold Approach in Cryptocurrencies

The objective of this thesis is to contrast basic buy-and-hold strategies, which involve pur- chasing an asset and maintaining it indefinitely without selling, with simple trading strategies. The primary concentration of this thesis is on the cryptocurrencies. Although this method may have been effective in the past, the current tumultuous times, which are characterized by global conflicts and widespread dread, raise concerns about its efficacy. Is it possible to locate a secure haven for capital in the presence of such circumstances? The objective of this thesis is to limit the maximal drawdown of the conventional buy-and-hold strategy by employing straightforward trading strategies that are based on price action indicators. Macroeconomic and microeconomic factors are not taken into account; only pure numerical data is consid- ered. ARIMA (AutoRegressive Integrated Moving Average) is a statistical technique that is employed to analyze and forecast time series data. Additional methodologies include momen- tum and trend following. Becouse, this thesis concentrates on cryptocurrencies, which are considerably more volatile than conventional stock or bond markets. If managed effectively, cryptocurrencies, which are founded on blockchain technology, have the potential to generate greater returns than the stock market. The goal is to ascertain whether these strategies can offer a more stable and profitable alternative to the traditional buy-and-hold approach.