5.6 How to Use the SoSoValue Index Creation Tool
User
1. Overview
What is the Index Creation Tool?
The SoSoValue Index Creation Tool is a visual platform that enables users to create, test, and publish cryptocurrency indexes without coding. It empowers both individual and institutional users to design multi-dimensional investment strategies — combining asset selection, weighting rules, and rebalancing logic — all through an intuitive interface.
Mission
To democratize index creation and make quantitative strategy design accessible to everyone in the crypto world.
2. Ecosystem Introduction
Open Index Compilation Ecosystem
SoSoValue is building an open cryptocurrency index ecosystem that allows users to design multi-dimensional investment strategies in a visual environment and present them as tradable indexes. By lowering the barrier to strategy creation, investors can flexibly combine asset weights, rebalancing cycles, and screening logic to meet diverse investment needs.
Supported by rich data sources and backtesting tools, strategy creators gain deeper insights into market trends and deliver more optimized allocation solutions. This inclusive system expands the boundaries of crypto finance and fosters collaboration between beginners and professionals.
SoSoValue Indexes (SSI) Protocol
At the core lies the SoSoValue Indexes (SSI) Protocol, which defines transparent and standardized index methodologies. Indexes that meet publication requirements can be made public within the ecosystem, and later, qualified indexes may apply for on-chain deployment after committee review.
Governance & Sustainability
Community governance anchors the ecosystem, with members actively shaping key parameters, standards, and publishing policies. Alongside robust compliance and auditing systems, SoSoValue ensures sustainable development, reliable operations, and long-term trust.
Through index investing, SoSoValue Indexes enable everyone to capture market trends and take part in shaping the future of decentralized finance.
3. Core Concepts
Index
A composite value that tracks the overall performance of a portfolio of crypto assets by aggregating their prices according to predefined selection and weighting rules.
Constituents
The tokens included in an index.
Selection Rules
Logic defining how assets are chosen (e.g., top N by market cap, sector filtering, liquidity constraints).
Weighting Rules
The method used to assign weights (e.g., equal, market cap, capped).
Rebalancing Cycle
Schedule for updating weights and constituents.
Backtesting
Historical simulation of index performance under selected rules.
Index Publication
The process of making a completed index publicly visible on the platform.
Index Metadata
Each index is defined by a set of standard metadata fields:
Index ID
Unique identifier automatically assigned upon creation.
Index Name
Display name of the index.
Base Date
The starting reference date for index calculation.
Rebalance Frequency
All indexes are rebalanced on the 1st day of each month based on updated market data.
4. Workflow
Step 1. Create a New Index
Navigate to Create Index.
Fill in:
Index name：The index name should clearly convey its meaning, will be publicly displayed after publication, can be edited before then, and must only contain letters, numbers, and spaces.
Step 2. Create Your Strategy
Use the visual selector to define filtering logic:
Choose sector(s) or spotlight(s) such as DeFi, Layer2, AI, etc.
Apply filters like minimum market cap, trading volume, or liquidity thresholds.
Constituents are dynamically determined by these conditions.
Sector and Spotlight
Sectors: The rules for sector classification can be found in the Index-General-Methodology document. Note that BTC is treated as a separate sector. You can select multiple sectors.
Spotlights: Lists of hot concept tokens that are highly recommended by the researchers of sosovalue.
Min. Listing days requirement
Include only those coins that satisfy the minimum listing day requirements. This is determined by the time span between the reference date and the cryptocurrency's initial listing date. The initial listing date is identified as the earliest date when the cryptocurrency became available for trading on any of the exchanges monitored by SoSoValue.
Market Cap Requirement
Market Capitalization (Market Cap) is a key indicator used to measure the overall scale of a digital asset in the market. It is calculated as:
Market Cap = Token Price × Circulating Supply
In this rule, the value of Market Cap is defined as the average market capitalization over the past 30 days prior to the reference date, to smooth out short-term volatility.
FDV Requirement
Fully Diluted Valuation (FDV) is a key indicator used to measure the potential total scale of a digital asset if all tokens were fully unlocked and in circulation. It is calculated as:
FDV = Token Price × Maximum Supply (Max Supply)
In this rule, the value of FDV is defined as the average fully diluted valuation over the past 30 days prior to the reference date, to smooth out short-term volatility.
Value Traded Requirement
Trading Volume is an important indicator of a digital asset’s liquidity and market activity. It is typically calculated as the total amount of buy and sell transactions over a specific period, across designated trading pairs and exchanges.
In this rule, the value of Trading Volume is defined as the 30-day average Trading Volume prior to the reference date, which helps smooth out short-term fluctuations.
Circulation Requirement
The Circulating Ratio is an important indicator that measures the proportion of a cryptocurrency that is actually in circulation compared to its total supply. It is typically calculated as:
Circulating Ratio = Circulating Supply ÷ Total Supply
In this rule, the value of the Circulating Ratio is defined as the 30-day average prior to the reference date, helping to smooth out short-term fluctuations.
Turnover Rate Requirement
The Turnover Ratio is an important indicator of a cryptocurrency’s liquidity and trading activity in the market. It is typically calculated as:
Turnover Ratio = Trading Volume over a specific period ÷ Market Capitalization (Circulating Market Cap)
A higher Turnover Ratio indicates more frequent trading and stronger liquidity, while a lower Turnover Ratio suggests weaker trading activity and lower liquidity.
In this rule, the value of the Turnover Ratio is defined as the 30-day average prior to the reference date, which helps smooth out short-term fluctuations.
If a cryptocurrency’s Turnover Ratio exceeds the set threshold, it can be included. Conversely, if it falls below the threshold, it will be excluded.
Excluded Coins
Coins added here will be excluded from your index composition, even if they meet the other selection criteria. Useful for removing specific tokens you don’t want included in the strategy.
Step 3. Set Weighting Rules
You will define how your index constituents are selected and weighted. These configurations determine the composition, diversification, and liquidity of your index.
Configuration Parameters
Parameter
Description
Number of Constituents
Define the total number of coins to include in your index. Constituents are selected in descending order by market capitalization.
Minimum Number of Constituents per Sector/Spotlight (optional)
Set the minimum number of coins for each sector or spotlight category to ensure balanced representation.
Weighting Rule — Market Cap
Constituents are weighted according to their circulating market capitalization. Capping Limit (optional): Sets a maximum cap on any single coin’s weight. If a coin exceeds the cap, the extra weight is proportionally redistributed among other coins. Minimum Limit (optional): Ensures each coin receives at least the defined minimum weight. After applying the minimum weight, the remaining allocation is distributed proportionally by market cap.
Reference Data
Weighting is calculated using market cap data as of the reference date.
Example Scenarios
Example 1: Setting a Capping Limit of 10%
Item
Description
Goal
Prevent any single coin (e.g., BTC, ETH) from dominating the index.
Rule Applied
Maximum weight per coin = 10%
Effect
If BTC’s calculated weight by market cap = 18%, it will be capped at 10%.
The excess 8% is redistributed among the remaining constituents in proportion to their relative market caps.
After redistribution, if any constituent’s new weight still exceeds the capping limit (e.g., 10%),
the system will repeat this reallocation process iteratively until no coin exceeds the defined cap.
This ensures the index remains balanced and compliant with the capping rule.
Result
The index remains diversified, avoiding overexposure to large-cap assets.
Example 2: Setting a Minimum Weight of 1%
Item
Description
Goal
Ensure small-cap coins maintain representation within the index.
Rule Applied
Minimum weight per coin = 1%
Effect
Each coin first receives 1% weight. Remaining allocation (e.g., 80% if 20 coins total) is then distributed proportionally by market cap.
Result
The index remains inclusive while still reflecting overall market capitalization.
Notes
The weighting calculation uses market cap data as of the reference date.
Proper capping and minimum weight settings ensure both diversification and liquidity.
Once all rules are configured, you can preview results before finalizing the index.
Step 4. Set Rebalancing Rules
You will define how and when your index rebalances. Rebalancing ensures the index remains aligned with underlying market conditions and adheres to its selection and weighting rules. It realigns the constituents with its predefined strategy, trimming assets that have grown too large and adjusting or increasing others to ensure the index remains a dynamic reflection of the portfolio it is designed to track.
Configuration Parameters
Parameter
Description
Rebalancing Frequency
Determines how often the index is rebalanced. Currently, the system supports Monthly rebalancing only (fixed). Future versions will support additional frequencies such as Quarterly.
Buffer Zone (Optional)
The buffer zone helps reduce frequent changes in constituent coins during rebalancing. It minimizes trading costs and improves index stability by setting thresholds for additions and deletions.
Buffer Zone Rules
The buffer zone is defined by two main thresholds — Deletion and Addition — which control how coins enter and exit the index.
Step 1: Delete Constituents
The deletion threshold prevents an existing constituent from being removed during rebalancing as long as its market cap ranking remains above (better than) the deletion limit.
This mechanism helps maintain stability and avoid unnecessary turnover due to short-term market fluctuations.
Example: Consider a Top 20 index with a deletion threshold at rank 30. During rebalancing, a current constituent that has fallen out of the top 20 will be retained, provided it still ranks within the top 30. It is only removed once its rank drops below this threshold.
Step 2: Add Constituents
The addition threshold specifies the market cap rank at which a new coin becomes eligible for inclusion.
A coin will be prioritized for inclusion in the index if its rank meets or exceeds this threshold during the rebalancing cycle.
Example: Suppose the Top 20 index has an addition threshold at rank 15. A coin not currently in the index is prioritized for inclusion if its rank climbs to 15th or higher as of the reference date.
Step 3: Maintain Fixed Number of Constituents
After applying addition and deletion rules, the system ensures that the total number of constituents remains fixed according to your index settings. If vacancies still exist, the index will bring in new constituents, selected in descending order of market cap, until the required number is met.
Notes
Rebalancing occurs automatically on the 1st day of the month.
Buffer zone settings are optional, but recommended for indexes tracking volatile assets.
⚠️ Important: If you have restricted the minimum number of constituents per sector or spotlight (set in Step 3), the buffer zone feature cannot be applied, since both mechanisms control constituent stability in different ways.
Maintaining a fixed number of constituents ensures index continuity and comparability over time.
Step 5. Run Backtest
In this step, you can simulate and compare the performance of your index strategy over time. Backtesting helps evaluate how your index rules would have performed historically before publishing the index.
Time Range
The backtest period starts from the earliest available month based on your index rules — specifically, from the 1st day of that month (earliest possible: 2024-01-10) — and runs until the 1st day of the current month.
The simulation is conducted on a monthly basis, aligning with the index’s rebalancing frequency.
Multiple Strategy Comparison
You can create multiple strategies using different selection or weighting rules for comparison.
The backtest chart will automatically align all strategies using the shortest available time range among them, ensuring all results are displayed on a consistent timeline.
This allows for fair and intuitive performance comparison between strategies.
Output and Visualization
The backtest results include key metrics such as:
1M ROI (1-Month Return)
3M ROI (3-Month Return)
6M ROI (6-Month Return)
YTD ROI (Year-to-Date Return)
The results are visualized as a performance chart, normalized to 100% starting value, allowing clear month-over-month comparisons.
Notes
Backtest results are for simulation only and do not guarantee future performance.
Data is updated monthly based on the latest available market cap and price information.
Backtest precision depends on the selected index rules, weighting method, and available historical data.
Step 6. Edit Index Info
In this step, you’ll complete the basic information required for your index profile and submit it for review before it can be published. This ensures your index is clearly identified, properly described, and meets all public display requirements.
Overview
You’ll need to provide the following information:
Index Ticker
A unique 3–6 character identifier composed of uppercase letters or numbers. This ticker represents your index and will be used across all displays and datasets.
⚠️ Once created, the ticker cannot be changed. Example: SVT20
Index Name
The official name of your index, explaining its theme or methodology. This name is displayed publicly across the platform.
⚠️ Once created, the name cannot be modified.
Base Date
The base date marks when the index’s initial value is set for comparison and performance calculation.
This date automatically adjusts to the earliest possible date allowed by your configured strategy.
Base Value
The initial numerical value assigned to the index on its base date.
All SoSoValue indexes have a fixed base value of 10.
Brief Description
A short explanation of your index configuration method, selection criteria, or composition approach.
Keep it concise (1–3 sentences).
Index Objective
A summary of what the index represents and aims to measure in the market.
Example: “The SoSoValue Top 20 Index represents the top 20 cryptocurrencies by market capitalization, providing a benchmark for the core performance of the digital asset market.”
Step 7. Publish Index
You need to fill in your basic information as the compiler. This information helps us understand your background and will be used for public display.
Submission & Review Process
Once all required information is filled in, click “Submit for Review.”
The system will check that all index data, rules, and descriptions are complete and valid.
Notes
You can save your progress as a draft before submission.
Step 8. View & Manage Indexes
Once your index is created, you can view, manage, and monitor its latest status through the SoSoValue Index Management Portal.
🔗 Access your dashboard: https://sosovalue.com/assets/cryptoindex/ssi-index-management
Overview
The management page provides an overview of all indexes you have created, including their current status, configuration details, and performance updates. You can check whether your index is still being processed, under review, or onlined.
Index Status
Status
Description
Actions / Notes
Draft
The index is still being edited and is only visible to you.
You can continue editing, saving as draft, or delete.
Data Preparation
Your index is being processed and data is being initialized. Index data will be updated within 60–90 minutes. You can then view full details, share it with others, and publish your index once it’s ready. You’ll receive an email notification once the update is completed.
No manual action required during this phase. Please wait for the update to complete.
Online
The index has been officially published and is live. You can set the index to either Unlisted or Public status: • Unlisted: Anyone with the link can view your index. • Public: The index will appear on the SoSoValue Indexes (SSI) list and be discoverable by all users.
You can share the link, add it to Watchlist, or adjust visibility between Unlisted and Public.
Offline
The index has been taken down and is no longer accessible via link. • Unlisted indexes can be deleted directly. • Public indexes require SoSoValue approval before deletion.
Use this status to manage or permanently remove deprecated indexes.
Note: Publishing to the SoSoValue Indexes Platform
Completed indexes will first undergo system review; Approved indexes will go live as [Personal indexes], which can be used for self-observation, sharing, or bookmarking; When an index's [exposure and bookmark volume] reaches certain levels, creators can submit applications to publish the index to the [SoSoValue Indexes], making it visible to SoSoValue users for greater exposure; As community governance advances, index publishing and management will gradually be decided by community voting.
Important: Listing an index on the SoSoValue Indexes (SSI) may take additional evaluation time. Please be patient while your submission is being reviewed.
5. Troubleshooting & FAQ
How can I use the index creation tool?
The index creation tool currently requires activation through invitation codes. You can obtain them through two methods:1. Submit application form: We will prioritize applicants based on their financial professional background, depth of SoSoValue usage (user activity duration), and influence in social media and communities. Application form: https://forms.gle/DfXpbK8cV4Vox9J692. Join official Telegram group: https://t.me/SoSoValueCommunity/364414 You can request invitation codes from OG users.Each user activated through official invitation codes will receive 5 additional invitation codes to invite others. However, these 5 accounts activated through invitation codes will not receive new invitation codes.
Which tokens can I use to create an index?
The current selectable sample space (all tokens that can be included in indexes) is based on quality tokens listed on SoSoValue. The system automatically excludes from SoSoValue's token list:
Tokens in the bottom 10% by market cap ranking;
Tokens in the bottom 10% by average daily trading volume over the last 1 days. The remaining tokens constitute the complete sample space for index creation.
What settings can I configure when creating an index?
The tool supports flexible rule configuration:
Each index can contain 3-50 tokens;
Creators can set minimum/maximum weights for individual tokens;
Supports filtering based on market cap, FDV, trading volume, turnover rate, or SoSoValue's trending/sector categories;
All indexes currently default to monthly rebalancing, executed automatically by the system. We will open more rebalancing cycles for your selection in the future.
How is performance data updated?
Based on month-end closing prices from SoSoValue market data feeds.
Can others see the index I created?
Yes. The process works as follows: • Completed indexes will first go through a system review. • Once approved, they will go live as Personal Indexes, which you can track, share, or add to your watchlist. • When an index reaches certain levels of exposure or bookmarks, creators can apply to publish it under SSI SoSoValue Indexes, making it visible to all SoSoValue users for greater exposure. • As community governance evolves, index publishing and management will gradually transition to community voting.
What benefits can I get from creating indexes?
Creating and publishing indexes has three-fold value:
Research tool: Supports backtesting and performance tracking, validating investment strategies;
Personal influence: Showcases investment logic, enhances professional brand, gains community recognition;
Continuous returns: In the future, indexes can be published as tradeable tokens through SSI Protocol, with creators receiving corresponding protocol revenue sharing.
How can I get help if I encounter other issues?
If you have any questions during usage, you can join our Telegram community: https://t.me/SoSoValueCommunity/364414 to get official assistance
6. Contact & Support
For technical questions or governance inquiries: 📧 support@sosovalue.com 🌐 https://www.sosovalue.com
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