Professor of Economics at Yale University Aleh Tsyvinski published the results of his new study, according to which investors are advised to keep bitcoin at least 6% of assets in its investment portfolio, regardless of how the investor applies to cryptocurrencies.
The Professor notes that for the optimal balancing of the portfolio in bitcoin should fall at least 6% of investment assets. In case the investor does not trust the cryptocurrency, he can reduce this proportion to 4%. At the very least the share of assets attributable to bitcoin, may be reduced to 1%. This approach will help to better diversify the investment portfolio.
The study findings are consistent with those of another Professor Dragan Boskovice (Dragan Boscovic) from the University of Arizona, who stated that institutional investors see in bitcoin a valuable investment opportunity that in turn motivates individual investors. In particular, this contributes to the fact that consumers and small shops are starting to use bitcoin and other crypto-currencies as means of payment.
A study entitled “Risks and profitability of cryptocurrency” also characterizes many of the positive features of cryptocurrency compared to traditional stocks and bonds.
Using the Sharpe ratio, Tsyvinski demonstrated that despite the increased volatility, the digital currency demonstrate a higher potential return. Ornatment that in his research the Professor has studied only Bitcoin, Ethereum and Ripple.
Observation of Cywinski and his colleagues are in direct conflict with the opinion of another famous economist, Nobel prize winner Robert Schiller, who earlier in may said that bitcoin is a failed experiment and “another example of the oddities of human behavior”.