Why it is wise to add bitcoin to an investment portfolio
It is a Nobel prize-winning diversification strategy
“DIVERSIFICATION IS BOTH observed and sensible; a rule of behaviour which does not imply the superiority of diversification must be rejected both as a hypothesis and as a maxim,” wrote Harry Markowitz, a prodigiously talented young economist, in the Journal of Finance in 1952. The paper, which helped him win the Nobel prize in 1990, laid the foundations for “modern portfolio theory”, a mathematical framework for choosing an optimal spread of assets.
This article appeared in the Finance & economics section of the print edition under the headline “Just add crypto”
Finance & economics September 25th 2021
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- China throws a wrench into a transpacific trade pact
- What are the systemic risks of an Evergrande collapse?
- Why it is wise to add bitcoin to an investment portfolio
- Beware the backlash as financiers muscle into rental property
- How threatening are the high levels of corporate debt?
- America’s debt ceiling is a disaster, though fiscal rules can help
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