Important points
- Brazil’s largest private bank advises allocating 1-3% of your investment portfolio to Bitcoin for diversification.
- Bitcoin offers protection against currency devaluation and has low correlation with traditional assets.
Itau Unibanco, Brazil’s largest private bank, recommended investors allocate 1-3% of their investment portfolios to Bitcoin to enhance diversification and protect against currency depreciation.
“Maintaining a well-diversified portfolio and adopting a tailored allocation to assets such as Bitcoin appears to be a strong strategy. The aim is not to make crypto assets the core of the portfolio, but rather to integrate them as a complementary element,” Renato Eid, Head of Beta Strategy and ESG Integration at Itau Asset Management, said in a recent report.
“The objective is to capture returns that are uncorrelated with the domestic business cycle, partially protect against currency depreciation, and increase the likelihood of long-term currency appreciation,” the analyst said.
Leading financial institutions are increasingly integrating digital assets into their wealth management strategies.
Morgan Stanley’s Global Investment Committee calls Bitcoin digital gold, describing the asset as speculative but mature, and recommends a 2% to 4% allocation to crypto assets for appropriate clients.
Bank of America advised its wealth management clients to consider allocating 1% to 4% of their portfolios to digital assets through regulated investment vehicles.
The bank will begin tracking four Bitcoin ETFs in January, allowing its 15,000 advisors to recommend these products: Bitwise, Fidelity, Grayscale, and BlackRock.
