Should You Add Bitcoin/Crypto to Your Investment Portfolio?

Should You Add Bitcoin/Crypto to Your Investment Portfolio?

If you’re like most investors, you’ve probably asked yourself: Should I add bitcoin or crypto to my investment portfolio? With cryptocurrencies going mainstream—and major institutions like Fidelity investing in research and reporting on digital assets—this is no longer a fringe question. It’s a strategic one.

What the Research Says

Let’s start with some data. Fidelity, one of the world’s largest asset managers, has published several insightful reports on bitcoin and digital assets. Their research indicates that even a small allocation to bitcoin—just 1–5% of your portfolio—can have a significant positive impact on long-term risk-adjusted returns. This is due to bitcoin’s unique properties: low correlation to traditional assets, high liquidity, and strong historical returns.

Fidelity’s 2024 “Bitcoin First” Report specifically highlights that adding a small slice of bitcoin to a diversified portfolio may improve overall returns while only minimally impacting volatility. In fact, they point out that the risk of NOT owning bitcoin could be greater than the risk of a modest allocation.

Why Consider Crypto?

Diversification: Bitcoin and other cryptos often move independently from stocks, bonds, and real estate. That means they can provide a cushion against market swings.

Potential for Growth: Crypto has consistently delivered higher returns over multi-year periods, despite volatility. Many experts see digital assets as a new asset class, with bitcoin leading the way as “digital gold.”

Inflation Hedge: With global concerns about inflation and currency devaluation, bitcoin’s fixed supply makes it an appealing store of value for many investors.

What About the Risks?

Like any investment, crypto isn’t without risks. Prices can be volatile. Regulatory changes can impact markets. That’s why a small allocation—typically 1–5%—is advised by leading researchers and wealth managers. It’s enough to capture upside potential while not jeopardizing your core holdings.

The Numbers Don’t Lie

Several studies, including Fidelity’s, show that portfolios with a 1–5% bitcoin allocation have historically outperformed those without. For example, a classic 60/40 (stocks/bonds) portfolio saw improved returns with only a 2% bitcoin allocation, with only a minor increase in volatility.

“From a portfolio perspective, investors can improve their risk-adjusted returns by including an allocation to bitcoin.”
— Fidelity Digital Assets, 2024

Take the Next Step: Learn Before You Invest

If you’re new to crypto or simply want to gain a deeper understanding, education is your best investment. At The Crypto Masterclass, we offer a range of beginner-friendly and advanced courses designed to help you make confident, informed decisions. Avoid costly mistakes, and take advantage of expert insights—before you buy your first bitcoin.