New Yale Study: Every Portfolio Should Include 6% Bitcoin (At Least)

New Yale Study: Every Portfolio Should Include 6% Bitcoin (At Least)
фото показано с : bitcoinist.com

2018-8-8 16:00

A new research paper published by an Economics Professor at Yale University recommends a portfolio with at least 6% in Bitcoin.

Adding Bitcoin to Your Investment Portfolio

According to Professor Aleh Tsyvinski, Bitcoin should be an imperative part of your portfolio, regardless of whether you are enthusiastic about the cryptocurrency or not.

For an optimal construction of one’s portfolio, the economist holds that Bitcoin should account for at least 6 percent of it. Those who are less enthusiastic about the world’s most popular cryptocurrency should hold 4 percent of it.

In any case, though, regardless of your position on the matter, Bitcoin should comprise a minimum of 1 percent of your portfolio just for diversification purposes.

The study seems to fall in line with the observations of another scholar – Professor Dragan Boscovic from the Arizona State University. Speaking on the matter of cryptocurrencies, he noted:

Institutional investors are recognizing this new asset as a valued investment opportunity; this will encourage individual investors. It will also encourage consumers and small shops to start trading in cryptocurrency.

Better Than Traditional Stocks

The study titled, Risks and Returns of Cryptocurrencies, also outlines a very positive feature of cryptocurrencies when compared to traditional stocks and bonds.

Using the Sharpe’s ratio, Tsyvinski demonstrated that digital currencies show higher potential for return, despite their increased volatility. It’s noteworthy, however, that the professor only examined Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) for the purposes of his study.

The observation of Tsivinsky and his colleague fall in direct contradiction with another noted economist – Nobel Prize Winner Robert Shiller, who said earlier in May that Bitcoin is a failed experiment and “another example of faddish human behavior.”

Nevertheless, Bitcoin (BTC) 00 has been struggling as of late. While Ethereum 00 and Ripple 00 have fared even worse amid a prolonged bear market through 2018.

What do you think of the recent study of Professor Tsyvinski? Don’t hesitate to let us know in the comments below!

Images courtesy of Shutterstock; 

The post New Yale Study: Every Portfolio Should Include 6% Bitcoin (At Least) appeared first on Bitcoinist.com.

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