For some reason, however, the mainstream investment community continues to be suspicious of Bitcoin. Not only is it not a fixture of most portfolios, but it is seen as a risk-on asset which should not have a permanent place in one’s portfolio. Yet, history has demonstrated Bitcoin’s resilience, and this upward trajectory does not look like it’s slowing down. One replier (@AdvenireWealth) to Voorhees told of his difficulties in convincing his ‘portfolio specialist’ co-workers about the merits of Bitcoin. This story is likely one which many are familiar with: the management board was against Bitcoin as a store of value. This is despite the fact that “port annual yield will make up most or all of the allotted allocation if it goes to zero.”How many years does Bitcoin need to be the best performing asset in the world before prudence suggests a 1% portfolio allocation? 10 of the last 12 years Bitcoin has beat every other thing.
— Erik Voorhees (@ErikVoorhees) February 12, 2020
Many cryptocurrency fans in the financial world have reported on these same difficulties. The story is the same every time: Bitcoin remains perceived as far too risky for most portfolio managers, and they would rather sit out. How long will it take for Bitcoin to be accepted by portfolio managers as deserving of an allocation? This shift likely won’t happen until the asset’s next all-time high. However, an allocation of 1% does seem fair, given the leading cryptocurrency’s returns over the last 12 years. If Bitcoin can break the $20,000 price point again, portfolio managers will once again take notice. Perhaps then, they will give Bitcoin its proper allocation in their portfolios.I just had a conversation with a Portfolio Design Specialist at BlackRock today. He was very much against our recommended 3-5% portfolio weight to BTC/GBTC.
— Advenire Wealth (@AdvenireWealth) February 12, 2020
Port annual yield will make up most or all of the allotted allocation if it goes to Zero. pic.twitter.com/oiY32CWbj9
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