Bitcoin’s bull run peak of nearly $40,000 caught the attention of many institutional investors — but Barclays Private Bank chief market strategist Gerald Moser doesn’t seem impressed.
“While it is nigh on impossible to forecast an expected return for bitcoin, its volatility makes the asset almost 'uninvestable' from a portfolio perspective,” Moser told Financial News.
Moser adds that the volatility seen in bitcoin mimics the behavior of other risk assets like oil. “Many would probably throw the cryptocurrency out of any portfolio in a typical mean-variance optimization.”
“The performance of the cryptocurrency has been mostly driven by retail investors joining a seemingly unsustainable rally rather than institutional money investing on a long-term basis,” Moser said.
Barclays, a large-scale financial service firm in the U.K., had previously shown interest in cryptocurrency and digital asset technology.