Bitcoin has surpassed conventional sectors such as technology and gold in year-to-date returns and risk-adjusted performance, becoming the top-performing investment asset.
Recent data from Goldman Sachs indicates that Bitcoin has outperformed conventional investment assets and sectors, such as technology and gold, regarding year-to-date (YTD) absolute returns and risk-adjusted-performance.
In terms of YTD absolute gains, the top cryptocurrency has outperformed information technology (+16%), communication services (+15%), consumer discretionary (+11%), Russell 1000 Growth (+10%), gold (+4%), and the S&P 500.
Meanwhile, energy and crude oil prices have fallen by 11% and 14%, respectively. With a score of 1.9 for risk-adjusted returns, as determined by the Sharpe Ratio, the benchmark coin has likewise exhibited good performance. This is greater than the information technology industry (1.5), the Nasdaq (1.4), and the healthcare industry.
The recent price increase of Bitcoin has been linked to the increased chance of the US Federal Reserve changing its aggressive monetary policy.
Since March 10, when authorities shut down Silicon Valley Bank, the cryptocurrency has grown by 35 percent.
Despite market experts’ warnings of a potential downturn, Bitcoin’s return has been greater than that of Wall Street equities, attracting the attention of investors.
The collapse of Terra, FTX, and Celsis 3AC and worldwide monetary tightening undermined investor confidence in cryptocurrencies in 2022, resulting in a significant Bitcoin downturn.
Notwithstanding the ongoing financial crisis, Bitcoin completed the week with a 34 percent rise, the most since January 2021, demonstrating a narrative change in the reputation of the biggest cryptocurrency.
After a terrible bear market, concerned cryptocurrency investors have welcomed the crypto rebound amid the continuing financial crisis, and some of them have argued that Bitcoin’s perception is shifting. Yet, Bitcoin’s value is still heavily influenced by inflation rate changes and Federal Reserve interest rate decisions.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.