A 'bit' risky
Bitcoins, money, and portfolio diversification
In this report we consider the big existential questions that bitcoin raises: What is money? How is bitcoin different to existing forms of money, and can it supplant them? We also take a look at some of the more pragmatic issues it raises: Is bitcoin a store of value? Is it a safe haven, like gold? Or does it perform best when animal spirits are high? Is there any diversification benefit of holding bitcoin in a multi-asset portfolio? Are investors aware of the environmental impact of mining bitcoin?
We hope this exploration of the philosophical and the practical will help shed some light on the bitcoin debate, and we hope you enjoy reading it.
Head of asset allocation research
Senior asset allocation analyst