Bitcoin Is Less Volatile Than Many S&P 500 Stocks

In the letter

  • Bitcoin has consistently been called “volatile”.
  • However, investment management firm VanEck compared the currency to stocks in the S&P 500.
  • The company’s research found that Bitcoin is less volatile than 112 companies in the index.

Bitcoin is less volatile than many stocks, according to investment management companies VanEck.

The Company compared the cryptocurrency to the S&P 500 companies, finding that Bitcoin was less volatile than 112 of them in 90 days. Last year, Bitcoin was a better choice than 145 stocks in the index.

Bitcoin has been blown up by some in the world of traditional finance because of its volatility. But VanEck said the story is not quite as simple as previously thought.

“While Bitcoin continues to be a volatile asset, it may surprise researchers and investors what other major assets have been more volatile than Bitcoin,” the company said in a blog post on Friday.

“Much of the volatility in recent years has been due to sensitivity to small overall market sizes, regulatory hurdles, and generally limited penetration of mainstream equity and capital markets.”

The company added that an exchange-traded US bitcoin fund (an investment vehicle that tracks the value of the currency) does not yet exist. In this case, however, it may have similar volatility characteristics as many stocks of well-known indices and ETFs. VanEck has withdrawn its own application for a Bitcoin ETF.

This isn’t the first time Bitcoin has proven to be a better investment than traditional stocks. One investor put in $ 1,000 in the top 10 cryptocurrencies in January 2019 as an experiment, and the digital assets – including Bitcoin, Ethereum and Bitcoin Cash – won.