An allocation of 1% in Bitcoin would bring „efficiency advantages“ for many portfolios.
Two analysts at the major Wall Street Bank believe that investing in Bitcoin is a good hedge against fluctuations in traditional asset classes such as stocks, bonds and commodities for many portfolios
Accordingly, a small investment of 1% of the size of the respective portfolio would be advisable in order not to expose yourself too strongly to the fluctuations in value of Profit Revolution. After the market-leading cryptocurrency hit its new current record high at $ 58,000 on February 21, it then went back down 20%. Overall, Bitcoin is still 60% up since the beginning of the year.
As Bloomberg reports, JPM analysts Joyce Chang and Amy Ho explain in a circular to the bank’s clients:
„In a multi-dimensional portfolio, investors should allocate up to 1% of the largest of the portfolio to cryptocurrencies in order to achieve efficiency advantages.“
With the praise for Bitcoin, the big bank agrees with a tenor that is led by major investors such as Paul Tudor Jones, Stan Druckermiller, Tesla and MicroStrategy. Even the New York bank BNY Mellon , the oldest bank in the USA, plans to offer custody services for cryptocurrencies in the future.
The analysts point out that cryptocurrencies should be understood as investment products and not as currencies such as the US dollar or the euro. Either way, with their recommendation, they contradict previous criticism of Bitcoin from their own company. Two of her JPM colleagues had called the crypto market leader „the worst hedge for the stock market“ this month.
Here could Bitcoin heard of „small“ amounts of investment will benefit enormously because as Cathie Wood of Ark Investment Management on February 17, CNBC vorgerechnet has the price of cryptocurrency would up to $ 200,000 increase if only every major corporation almost 10% of converts your own cash reserves into Bitcoin.
In the new year, interest in Bitcoin investments is greater than ever before, and this is not only true of companies and large investors. As the trading platform Robin Hood indicates , she’s already in the first two months of 6 million new crypto users registered , which is a significant increase over the previous year.
Further evidence that the interest of small investors is currently still high, although the record run is slowly waning. As of press time, Bitcoin has lost just under 7% in the past 24 hours, trading at $ 47,100.