A new released white paper says that bitcoins represent as a new asset class. And resulting from that everyone should consider this as diversifying investment option. Mr. Chris Burnsike, block chain analyst of ARK investment management Says that “Bitcoin is the lowest correlated asset class to other traditional asset classes”.
“It is the time for investors to take a serious look at bitcoin and other virtual currencies. There’s a limited amount of bitcoin. By creating a bitcoin and owning it, you own a portion of this technology which allows you to access all the benefits.” says Adam White, Coinbase.
Cerulli associates (Global asset management in U.S) proves that at the end of 2015 U.S households had more than 34.5 trillion in an investable asset class. Adoption of bitcoin as an investment can boost its price.trading volume level.
In normal bitcon price may behave differently when comparing to other assets. It has lowest correlation while comparing to other assets.
According to investopedia.
The Sharpe Ratio is a measure for calculating risk-adjusted return, and this ratio has become the industry standard for such calculations. It was developed by Nobel laureate William F. Sharpe. The Sharpe ratio is the average return earned in excess of the risk-free rate per unit of volatility or total risk
There are some basic factors which can describe why bitcoin may be consider as a new asset class.
- Politico – Economic profile
- Price Indpendence
- Risk reward profiles