And do you know everything about cryptocurrency? Understanding that having a balanced portfolio is essential for beginners.
Let's talk a little about bitcoin($BTC ) and about a balanced portfolio.
Bitcoin is a cryptocurrency created in 2009 by an individual or group under the pseudonym Satoshi Nakamoto. It is a decentralized digital currency, operating through a technology known as blockchain, which allows for secure verification and recording of transactions. Unlike traditional currencies, Bitcoin is not controlled by a central authority, such as a bank or government, but is managed by the network of users itself. One of the most notable characteristics of Bitcoin is its limited supply, with a maximum of 21 million units to be issued, which increases its potential for appreciation over time. However, Bitcoin is also known for its high volatility, with significant fluctuations in its value, classifying it as a high-risk asset.
When we think about building a balanced investment portfolio, the main goal is to diversify assets in a way that maximizes expected returns while seeking to reduce risks. A balanced portfolio typically includes a mix of asset classes, such as stocks, fixed income securities, real estate, and in some cases, alternative investments like cryptocurrencies.
Having Bitcoin in an investment portfolio can be a valid strategy, especially for those who want exposure to high-growth assets. However, given the inherent volatility of Bitcoin and other cryptocurrencies, it is recommended that its allocation be limited to a small fraction of the total portfolio, usually around 1% to 5%, depending on the investor's risk profile. The remainder of the portfolio should consist of more stable and predictable assets, such as government bonds, shares of established companies, and investment funds, to ensure a solid base for protection and moderate growth.