Education

Bitcoin’s Role in a Traditional Portfolio

San Francisco • August 28, 2023

What influence has bitcoin had on a diversified portfolio’s risk-adjusted returns? 

In this newly updated study, the Bitwise research team evaluates the historical impact of adding bitcoin to a traditional 60/40 stocks/bonds portfolio. Drawing on comprehensive data from nearly a decade of bitcoin returns, the study examines a wide variety of rebalancing strategies, allocation sizes, and holding periods. 

The findings are remarkable. 

Assuming quarterly rebalancing, bitcoin would have contributed positively to a diversified portfolio’s returns in 70% of one-year periods, 94% of two-year periods, and 100% of three-year periods since 2014. The study also highlights bitcoin’s counterintuitive influence on portfolio risk metrics and addresses three key questions investors should ask when considering a bitcoin allocation.

Read White Paper

About Bitwise

Bitwise Asset Management is the largest crypto index fund manager in America. Thousands of financial advisors, family offices, and institutional investors partner with Bitwise to understand and access the opportunities in crypto. For six years, Bitwise has established a track record of excellence managing a broad suite of index and active solutions across ETFs, separately managed accounts, private funds, and hedge fund strategies. Bitwise is known for providing unparalleled client support through expert research and commentary, its nationwide client team of crypto specialists, and its deep access to the crypto ecosystem. The Bitwise team of more than 60 professionals combines expertise in technology and asset management with backgrounds including BlackRock, Millennium, ETF.com, Meta, Google, and the U.S. Attorney’s Office. Bitwise is backed by leading institutional investors and has been profiled in Institutional Investor, Barron’s, Bloomberg, and The Wall Street Journal. It has offices in San Francisco and New York. For more information, visit www.bitwiseinvestments.com.

Authors
  • Matt Hougan

    Matt Hougan

    Chief Investment Officer
  • Gayatri Choudhury

    Quantitative Crypto Research Analyst
Share
  • Copied to Clipboard