Evolution of portfolio management

If there is anything we can all agree on as a collective species inhabiting this earth, it’s that making more money with less of our time is a great and wonderful thing.

In theory, this is why portfolio managers exist. While the concept of letting someone else manage your money goes back to the days of rubbing two sticks together to make fire, it didn’t really become popularized and accepted until around the 1980’s — much thanks to the movie Wall Street.

Portfolio managers in nature, are supposed to have a wealth of deep insight and knowledge on specific markets, and the individual players in that market. In fact, they have so much knowledge and expertise that you could not possibly garner as much information if you even tried! Which is why you can give them your hard earned money instead — with the understanding of course that the money you give them will magically increase over a period of time. The best portfolio managers are able to successfully execute trades and investments that the average person like me or you would not. But there is a key variable that needs to be understood, which empowers the entire dynamic to work: trust.

In the real world, trust is established through deep connections over time, consistent proof of success, and law bound contracts. While this may sound great, the reality is that these provide multiple layers of bureaucracy which accumulate fees and headaches along the way. How do you know which portfolio manager has performed the best? How do you know they’re not lying? If you’re spending all this time researching each and every portfolio manager and tracking their performance, aren’t you just better off putting that time and effort into researching the market so you don’t have to pay a fee to let someone manage your money?

Those are all great questions to a problem that has ballooned exponentially. Luckily, certain features of blockchain technology have been able to address some of these issues, with projects like APYSwap building on top of that to further implement a smooth and effective portfolio management system for crypto traders through the use of their Vaults.

In DeFi, unlike the real world, you can write permissionless code within smart contracts so that when A happens, B follows suit. This is one of the true powers of decentralization, and allows users to form the vital trust factor much faster because there is an automatic escrow system in place. Not only that, but on-chain portfolio managers would have all their previous transactions auditable through TX’s, so any user who is considering letting them manage their assets would be able to accurately perform an audit if concerned about the trader’s performance.

Despite its relatively youth, DeFi can be a complicated beast that is still ever evolving. For example, Uniswap’s latest V3 update saw a drastic overhaul of how LP tokens are used in the supply chain system. This is a perfect example of potentially complications that the average user does not have the time or energy to understand.

With APYSwap’s vault feature though, this problem becomes much simpler as average users who are interested in DeFi are able to purchase part of a “vault” that a professional or more seasoned DeFi trader locks up. This essentially becomes the “portfolio” that people like you and me can purchase a stake from. Not only that, but APYSwap’ ambition to become truly cross-chain would allow these vaults to store assets from all across the blockchain universe, ranging from NFT’s to BSC based assets.

At the end of the day, DeFi is going to only get more complex as a financial instrument. This factor is easily offset with APYSwap, which gives us all what we want at the end of the day — more time to spend with the people we love, while making passive income on the side.

APYSwap Foundation is established to inspire and support new projects using the APYSwap ecosystem.