Crypto exposure has a positive impact on investment portfolios, study shows
Iconic Funds and Cryptology Asset Group, a crypto asset management firm, has recently brought out a study that shows the positive impacts of diversifying portfolios with crypto investments. Having a stake in crypto investment positions has a direct correlation with how diversified investment portfolios perform in the long run. The study was comprehensive and took into account various factors. They concluded with the assertion that crypto investments have the ability to have a positive impact on investment portfolios across sectors. It is an interesting revelation since the cryptocurrency market crashed not long ago, in May.
The research paper is titled “Cryptocurrencies and the Sharpe Ratio of Traditional Investment Models”. In the research, analysts examine how the performance of investment portfolios changes when crypto-assets are added to them. Many crypto experts and veterans have long argued for the same. Now their claims have a theoretical framework that cannot be disputed.
Cryptocurrency investments are a sensitive subject for many conventional investors. However, the picture is slowly changing as more and more institutional investments take place. All of it clearly points to the rising interest in cryptocurrency. More and more institutional investors now want exposure to crypto. Until a few years back, this was unimaginable.
As we move towards the end of 2021, we can expect greater participation in the crypto space. Some of it would come from retail investors, but institutional investors might show the highest increase in engagement and investment. The trend is already in motion, with various financial institutions showing interest in cryptocurrency. With time, it is set to increase even more.