The Case for Crypto in an Institutional Portfolio
San Francisco • Aug 10, 2021
This paper revisits the case for adding crypto assets to a diversified portfolio of stocks and bonds by updating the data in a previous paper.
We consider the impact that different allocations to crypto assets would have had on a Traditional Portfolio consisting of 60% equities and 40% bonds under a myriad of different market regimes. The results show that crypto would have contributed positively to a diversified portfolio’s cumulative and risk-adjusted returns in 100% of three-year periods, 97% of two-year periods, and 77% of one-year periods since 2014, assuming quarterly rebalancing. Crypto has positively impacted portfolios even over periods in which crypto’s price has declined.
READ WHITE PAPERBitwise Asset Management is a global asset manager specializing in crypto and onchain finance with a nine-year track record and more than $14 billion in client assets. The firm’s suite of over 70 investment products—spanning ETFs, option income strategies, model portfolios, DeFi vaults, tokenized funds, and staking—helps investors access opportunities across the financial frontier. Bitwise serves more than 5,500 private wealth teams, RIAs, family offices, and institutional investors, as well as 21 banks and broker-dealers. The company is headquartered in San Francisco, with offices in New York and London.
