BlackRock Investment Institute's official reports and publications

BlackRock's $11.5 Trillion AUM Recommends Up to 2% Bitcoin Allocation, Cites ETF Success

Dec 12, 2024, 09:58 PM

BlackRock Inc., the world's largest asset manager with $11.5 trillion in assets under management, has recommended that investors consider allocating up to 2% of their portfolio to Bitcoin. This recommendation comes from a report by BlackRock Investment Institute, authored by Samara Cohen, Chief Investment Officer of ETF and Index Investments, which compares Bitcoin's risk profile to that of the 'Magnificent Seven' tech stocks, suggesting that a 1-2% allocation to Bitcoin in a traditional 60/40 portfolio would yield a similar share of portfolio risk. The firm's analysis indicates that Bitcoin's value is driven by its potential for widespread adoption, its lack of correlation with traditional assets, and its role as a diversifier. However, BlackRock warns that allocations beyond 2% would sharply increase Bitcoin's share of overall portfolio risk due to its volatility. The recommendation reflects BlackRock's growing engagement with cryptocurrencies, highlighted by its management of the largest Bitcoin ETF, the iShares Bitcoin Trust (IBIT), which holds nearly $54 billion in assets.