- Wall Street giant JPMorgan tells investors to use Bitcoin as a way to increase their portfolios
- Analysts believe that crypto is capable of hedging risks from fluctuations in traditional assets
- Investments and support from large companies are driving the BTC price to all-time highs
JPMorgan analysts advise their clients to move 1% of their investment portfolio to Bitcoin and other digital assets. They believe that cryptocurrency is capable of hedging risks from fluctuations in traditional asset classes such as stocks, bonds and commodities.
According to Bloomberg, the Wall Street giant JPMorgan is floating the idea of investors using Bitcoin as a way to increase their portfolios. Its analysts recommend investing no more than 1% in the main digital currency to reduce the risk of sharp drops in the value of Bitcoin.
“In a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall risk-adjusted returns of the portfolio,” wrote JPMorgan strategists.
They believe investing a percentage in bitcoin will hedge against fluctuations in traditional assets. “Cryptocurrencies are investment vehicles and not funding currencies,” analysts say.
Meanwhile, investments and support from large companies are driving the price of BTC to all-time highs. These include Tesla’s purchase of Bitcoins, adding BTC to its corporate treasury by MicroStrategy, Paypal support, to name a few.
Recall, on February 21, the Bitcoin price reached $ 56,000. On February 23, the rate of the first cryptocurrency touched the $ 45,000 mark. At the time of writing, the asset is trading at $47,850. The market capitalization of digital gold is $ 891 billion, according to CoinGecko.