Fidelity Report Says Portfolios Should Consider 5% Bitcoin Allocation


Fidelity Digital Assets recommended in a Tuesday report that investors “consider” diversifying 5% of their portfolios into bitcoin.

  • A disciplined 5% would position investors to capitalize on bitcoin’s potential growth while protecting against losses, the cryptocurrency unit of the mutual fund giant wrote in its latest report on bitcoin’s investment thesis, spotted Tuesday by Decrypt.
  • Director of Research Ria Bhutoria wrote that the crypto’s current market capitalization “is a drop in the bucket compared with markets bitcoin could disrupt.”
  • Bhutoria argued that while institutional inflows may damp bitcoin’s uncorrelated performance, the crypto is “fundamentally less exposed” to the “economic headwinds” that other assets will likely face.
  • Bitcoin is therefore a “potentially useful” asset for uncorrelated return-seeking investors. “Consider a portfolio with a target allocation of 5% bitcoin,” she wrote. 
  • “In a world where benchmark interest rates globally are near, at, or below zero, the opportunity cost of not allocating to bitcoin is higher,” the report said.

UPDATE: 20:42 UTC: Adds details from the report.

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