Backtesting shows bitcoin holding methods in a 60/40 portfolio significantly impact returns across market regimes.
A backtest by Lionsoul Global’s Gregory Mall demonstrates how bitcoin allocation strategies—straight position, large-cap basket, or trend-managed sleeve—perform differently in bull, bear, and sideways markets within a 60/40 portfolio. The analysis highlights that the method of holding bitcoin can be as critical as the allocation size itself.
The study follows Mall’s earlier work on sizing crypto risk, comparing performance across varying market conditions. While a straight bitcoin position may outperform in bull runs, trend-managed approaches aim to mitigate drawdowns during downturns, offering allocators a risk-adjusted alternative.
The findings suggest institutional investors should weigh holding strategies alongside allocation size when integrating bitcoin into traditional portfolios. No immediate market reaction was reported in the analysis.