BlackRock, one the biggest asset management enterprises in the world has added Bitcoin to their Asset Allocation Fund. The Global Allocation Fund is one of the most sought-after and popular funds among investors related to passive trading and ordinary trading products.
At its core, this fund has invested in global options such as equity, debt, short-term securities, government issued bonds without prescribed limits.
The Fund managers have told the media that around 70% of the total assets are going to be committed toward securities from private and government publishers. As per the remarks from the managers, the fund is known to invest in securities that are rare and undervalued.
On the other hand, some equity securities from small-scale but rapidly growing companies have been added to this fund as well.
The BlackRock Global Allocation Fund is also invested in debt from high-yield and fixed-income transferable securities. On the other hand, the currency exposure for the said fund is also managed flexibly.
The investor of this fund is usually people from professions like teaching and nursing. Because the fund is an ideal backup for those who do not have a lot of time to track the latest updates in the financial markets.
Another reason that this fund is popular among investors is on account of its massive diversification and global growth tracking features. The fund manages a total of $15 billion in assets as AUM and it has proceeded to invest in Bitcoin alongside equities and other assets as per the official filing issued by BlackRock.
There is a possibility that this fund will also invest in cash-settled Bitcoin Futures that are registered with the CFTC.
Bitcoin’s Reputation as a Common Investment Diversification Tool
The Global Allocation Fund has been introduced by several major financial corporations such as Vanguard. On this matter Vanguard CIO, Greg Davis has told the media that the fund managers cannot ignore the benefits of diversifying it using cryptocurrencies but it feels secure sticking to the conservative trading practices to retain the trust of its investors.
On the other hand, several studies indicate that the risk-adjusted returns for Bitcoin have increased consistently. Crypto can be used for various reasons for such a fund but for BlackRock fund it is all about long-term investment positions.
Historically speaking the average returns for Bitcoin after every four years have been good. The addition of Bitcoin by BlackRock may also point toward the fact that Crypto is going to the league at a slow but steady pace.