Abstract
Research background: Since the financial crisis in 2008, numerous other cryptocurrencies have established themselves in the financial industry alongside Bitcoin. Although the validity of the user cases is still lacking, Bitcoin is already being used extensively in the institutional finance sector, among others. Here, the comparison of Bitcoin to other asset classes in mixed portfolio structures must be taken into account. According to the latter, far-reaching areas of investigation emerge by adding Bitcoin in the evaluation of risk-return ratios of mixed portfolio weightings. Purpose of the article: The objective of this paper is to examine, within the framework of Harry Markowitz’s efficiency theory, the impact of including Bitcoin as an investment asset for the risk-return ratios of mixed portfolio structures. Methods: The statistical analysis is based, among other things, on paired sample tests, where the return and volatility values are tested for significant differences in the selected test values. Findings & Value added: The statistical investigations show that the introduction of Bitcoin leads to advantageous return structures, but at the same time to significantly increased volatility values of the examined portfolio constellations. Setting a regional focus of the investment assets in the investigations led to a simplified evaluation basis and at the same time offers the scientific space for further investigations.
Highlights
In recent years, especially during periods of global economic downturns such as in 2001, 2008, and 2020, alternative assets showed a significant diversification effect when considering mixed asset portfolios (Candelon et al, 2021)
Purpose of the article: The objective of this paper is to examine, within the framework of Harry Markowitz’s efficiency theory, the impact of including Bitcoin as an investment asset for the risk-return ratios of mixed portfolio structures
The mixed-asset portfolios under study have been examined by adding Bitcoin as an alternative investment asset during the three research periods
Summary
Especially during periods of global economic downturns such as in 2001, 2008, and 2020, alternative assets showed a significant diversification effect when considering mixed asset portfolios (Candelon et al, 2021). As investment decisions in global portfolio management are increasingly guided by a more intensive focus on returns, the importance of alternative asset classes has come into focus at least since the economic crisis in 2008 (PwC, 2018) In this context, asset classes are influenced by comparable macroeconomic factors due to globalized financial and commodity flows, so that an interdisciplinary linkage has to be considered and novel influencing factors affect the entire global economy (Gerster, 2005). Following the global market trend, the World Economic Forum was quick to ascribe cryptocurrencies a far-reaching radius of importance according to the report “Deep Shift Technology Tipping Points and Societal Impact” (World Economic Forum, 2015) This finding was extended by a far-reaching statement as part of the “Great Resets” publications (World Economic Forum, 2021), with an assigned council proclaiming that “Cryptocurrencies have reached a point of inevitability” (World Economic Forum, 2020). Are the research findings of a scholarly examination of the relevance of Bitcoin and alternative assets when considering mixed asset portfolios
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
