BlackRock urges 1 to 2 percent bitcoin allocation, reaffirms portfolio benefits despite 50 percent drop

Even with bitcoin down about 50 percent from its peak, an analysis says a small bitcoin allocation can improve the risk-adjusted return of a traditional investment portfolio. BlackRock focused on the overall portfolio effect when bitcoin is held alongside existing assets, rather than bitcoin’s standalone volatility.

Bitcoin Magazine reported on Sept. 1 that BlackRock, in a recent report titled “Bitcoin Revisit Review: Is It Still a Portfolio Diversifier,” assessed that the rationale for allocation remains intact for institutional investors even after bitcoin fell about 50 percent from its October 2025 peak.

The key is not bitcoin’s volatility itself but the portfolio’s overall risk and return structure. BlackRock compared a traditional 60/40 stock-bond portfolio with portfolios that include some bitcoin, using 10 years of rolling data through May 29, 2026.

The analysis found the 60/40 portfolio had an annualised return of about 9.9 percent and an annualised standard deviation of about 10.1 percent. With a 1 percent bitcoin allocation, the annualised return rose to about 10.9 percent while the standard deviation edged up to 10.3 percent.

With bitcoin raised to 2 percent, the annualised return was about 11.8 percent and the standard deviation about 10.6 percent. While returns rose about 1.9 percentage points, volatility increased by only about 0.5 percentage points.