A professor at Yale University thinks everyone needs to own bitcoin.
According to an article released a few months back, professor Aleh Tsyvinski thinks that the perfect risk adjusted portfolio needs to include an allocation to bitcoin.
This is coming on the heels of my post yesterday where I said that at some point just about all the big macro funds will hold at least a little bit of bitcoin.
That can be seen here:
Why should everyone hold bitcoin?
According to Tsyvinksi, he did some research modeling some portfolios holding different assets and different asset classes...
His findings were that due to the asymmetrical potential for returns with bitcoin, it needs to be owned.
His findings showed that a 4% allocation was ideal, though for those that were slightly less risk averse, a 6% allocation could be practical as well.
More about his findings can be found here:
https://bitcoinist.com/new-yale-study-every-portfolio-must-include-at-least-6-bitcoin/
So, basically his thesis is due to the large percentage gains bitcoin has enjoined since its inception.
Novogratz agrees on the allocation, but for a different reason.
As I mentioned in my post yesterday, Novogratz thinks that bitcoin is a perfect gold proxy.
It should be owned in place of, or along with, gold as a portfolio hedge against market uncertainty at an allocation of at least 1%.
Novogratz used to manage a very large macro fund on Wall Street and likely still has many contacts/friends in the industry...
Which means, him saying that he thinks many funds will start an allocation to bitcoin carries more weight than most who would say this...
There you have it folks, bitcoin needs to be owned anywhere from 1%-6% due to the potential for asymmetrical returns as well as it's properties as digital gold.
Eventually this is going to catch on with many of the major funds.
Stay informed my friends.
Image Source:
https://bitcoinist.com/new-yale-study-every-portfolio-must-include-at-least-6-bitcoin/
