Blackrock's report indicates that BTC should occupy more than 80% of an investor's portfolio. Retail investors continue to support BTC.
The document, titled “Asset Allocation with Crypto: Application of Preferences for Positive Skewness,” revealed that BlackRock recommends an impressive 84.9% allocation of BTC in a risky portfolio. The study, conducted in April 2022, analyzed Bitcoin’s performance as an asset from July 2010 to December 2021 on a monthly basis.
According to BlackRock’s findings, for a 60-40 portfolio the optimal allocation of BTC is 84.9%. This left the remaining 15.1% to be divided between equities and bonds in a 60-40 ratio. Although the study was written last year, it has recently gained significant popularity on Twitter. This recommendation from BlackRock underscores the growing recognition of Bitcoin as a potentially valuable component of a diversified investment portfolio.The study’s significance extends to its potential implications for BlackRock’s promotion of Bitcoin once the spot ETF receives approval from the SEC. It draws parallels to the first gold ETF story, which could repeat itself for Bitcoin.
Notably, after the introduction of the first gold ETF in 2004, the gold price soared fivefold. This impressive growth was attributed in part to BlackRock’s global financial advisors. They strongly advocated a 5% gold allocation as an essential component in every portfolio.Given this historical precedent, BlackRock’s support and promotion of Bitcoin through ETFs could play a crucial role in driving further adoption and potentially impacting Bitcoin’s market dynamics in the future.
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