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What percent of my portfolio should be in crypto?

The short answer is that there is no right answer. Each investor must evaluate how aggressive they want to be.

Factors that impact this decision may include:

  • how much you can save
  • your time horizon, and
  • your willingness to bear risk that your crypto will decrease in value.

To illustrate this last point, a CFA Institute Research Foundation report suggested a 2.5% allocation to Bitcoin (between January 2014 and September 2020) improved returns from a traditional portfolio by nearly 24%. In this time frame, Bitcoin’s price grew 2,875%. However, if you had added the same amount of Bitcoin in December 2020, the impact through July 2022 would have been ~0%. Ultimately, past results are not guarantees of future performance.