Allocating funds to crypto investment positions has been shown to have a positive impact on the performance of diversified investment portfolios.
According to a research study by crypto asset management outfits Iconic Funds and Cryptology Asset Group, the ability of crypto investments to positively impact the performance of investment portfolios cuts across several asset allocation models.
This ability to improve the profitability of diversified investment portfolios is even despite the volatility of cryptocurrencies, especially the recent market crash that occurred in May.
The research study titled: “Cryptocurrencies and the Sharpe Ratio of Traditional Investment Models” examined changes in the risk-return profile of several portfolio allocation methods due to the addition of cryptocurrency assets.
This risk-return examination was conducted via measuring changes in the Sharpe ratio — the measure of