[Analysis] "Bitcoin Outperforms Gold in Risk-Adjusted Return Indicator"

Uk Jin

Summary

Bitcoin recently surpassed $100,000, emphasizing its role as a 'store of value.'
Jurrien Timmer, Fidelity Director, stated that Bitcoin's Sharpe Ratio is converging with gold, indicating Bitcoin's advantage over gold in the risk-adjusted return structure.
Bitcoin Suisse explained that the rise in Bitcoin's Sharpe Ratio is positively evaluated, gaining popularity among various investors.

Bitcoin (BTC) recently surpassed $100,000, emphasizing its role as a 'store of value,' according to analysis.

On the 19th (local time), Cointelegraph, a cryptocurrency-focused media outlet, reported that Jurrien Timmer, Fidelity's Global Macro Director, analyzed in a report that "Bitcoin's Sharpe Ratio (risk-adjusted return indicator) is converging with gold."

Regarding this, Director Timmer explained, "This shows that Bitcoin is catching up with gold in terms of risk-adjusted returns. While Bitcoin and gold share the common characteristic of being a store of value, they exhibit the most negative correlation with each other. Bitcoin holds an advantage over gold in the risk-adjusted return structure."

Additionally, Director Timmer recommended setting the investment ratio of Bitcoin to gold at 1:4 for risk hedge investments.

Meanwhile, it is expected that a higher Sharpe Ratio will have a positive impact on Bitcoin. Bitcoin Suisse explained, "Since the U.S. presidential election, Bitcoin's Sharpe Ratio has been continuously rising, gaining popularity among both risk-seeking and risk-averse investors."

BTC