BITO (Bitcoin Asset) as an alternative diversification asset
Fundamental Analysis
Bitcoin is highly correlated with Equity assets in the near-term. The asset would decouple from this positive correlation the way Gold did when it switched from a speculative commodity into a safety asset. In the short-term, there will be high volatility, but in the long-term this asset could decouple from the Equity market once regulations are increased on it.
BITO etf has had a huge sell-off and could be a good hedge for a portfolio in the long-term, with a potential for a huge spike once regulations favour this commodity as a viable risk asset.
From a portfolio approach, it helps with diversification in the long-term when the asset starts to trade more uncorrelated with the equity markets and trades more like the derivatives market.
This is still not a well-established risk asset and should be treated like currencies in the short-term.
Technical Analysis
Bitcoin in the short-term is acting like an equity risk asset. Over the long-term, it should decouple and be a better risk instrument. However, it is still underpriced compared to gold and can be used as a risk hedge for a portfolio.
Bitcoin is highly correlated with Equity assets in the near-term. The asset would decouple from this positive correlation the way Gold did when it switched from a speculative commodity into a safety asset. In the short-term, there will be high volatility, but in the long-term this asset could decouple from the Equity market once regulations are increased on it.
BITO etf has had a huge sell-off and could be a good hedge for a portfolio in the long-term, with a potential for a huge spike once regulations favour this commodity as a viable risk asset.
From a portfolio approach, it helps with diversification in the long-term when the asset starts to trade more uncorrelated with the equity markets and trades more like the derivatives market.
This is still not a well-established risk asset and should be treated like currencies in the short-term.
Technical Analysis
Bitcoin in the short-term is acting like an equity risk asset. Over the long-term, it should decouple and be a better risk instrument. However, it is still underpriced compared to gold and can be used as a risk hedge for a portfolio.
הערה:
As per latest report in Barron's Crypto has started to decouple from stocks where Bitcoin is down 34% while Nasdaq is down 25%.