How much Bitcoin should I have in my portfolio?

There is no universal percentage. This calculator compares allocations from 0% to 20% while funding Bitcoin proportionally from your starting mix. Consider your time horizon, cash needs and the assumptions you are willing to use alongside the result.

Does Bitcoin improve portfolio diversification?

It can, depending on the allocation and co-movement with other assets. This model uses historical monthly correlations and forward-looking return assumptions. Correlations can change. Bitcoin inputs are Portfolio Lab assumptions, not J.P. Morgan forecasts.

What does the best allocation mean here?

It is the highest modelled Sharpe ratio within 0% to 20% Bitcoin, tested in 0.5 percentage-point steps. A result at 20% is a boundary result, not evidence of a global optimum. Higher assumed returns can change the result without changing the stress loss.

Is volatility the same as losing money?

No. Volatility measures variation in returns. The separate stress row calculates a hypothetical 70% Bitcoin fall, with optional falls in shares and bonds. It is neither a predicted loss nor a maximum drawdown estimate.

Bitcoin Allocation Calculator

Your Current Portfolio

Stocks60%

Bonds30%

Cash10%

USD edition: Stocks = MSCI ACWI · Bonds = US Aggregate · Cash = US Cash

Test your Bitcoin conviction

Bitcoin annual compound return assumption

These are assumptions, not forecasts promised by a provider. Bitcoin volatility stays at 42.5%; correlations stay unchanged, so you can isolate the effect of the return assumption.

Stress shares and bonds too: shares fall 20%, bonds fall 10%, cash stays flat.

The stress row always assumes Bitcoin falls 70%. With this box off, all other assets stay flat. It is a hypothetical one-period price shock before rebalancing, not a probability or a predicted maximum loss.

Highest modelled Sharpe within 0% to 20% Bitcoin

20.0%

Modelled Sharpe: 0.346 → 0.482 with 3.3pp more volatility

Search: 0.5 percentage-point steps, with Bitcoin funded proportionally from the starting mix. This objective measures return per unit of volatility; it does not choose an allocation for your spending needs.

The best result is at the 20% search limit. This does not establish an optimum above that limit.

Side-by-Side Comparison

Metric	0% BTC	1% BTC	2% BTC	5% BTC	10% BTC	15% BTC	20% BTC
Expected Return	6.2%	6.4%	6.5%	7.0%	7.6%	8.3%	8.9%
Volatility	10.6%	10.6%	10.7%	10.9%	11.6%	12.6%	13.8%
Sharpe Ratio	0.346	0.359	0.371	0.403	0.444	0.468	0.482
Hypothetical stress return	0.0%	-0.7%	-1.4%	-3.5%	-7.0%	-10.5%	-14.0%

Volatility measures variation, not a realised loss. The stress row applies the explicit price shocks above; it is not inferred from volatility. Highlighted column has the best Sharpe ratio.

Risk-Return Frontier

Each point represents a different Bitcoin allocation (0-20%). The teal dot marks the highest modelled Sharpe ratio within that range.

Key Insight: Adding 20.0% Bitcoin to your 60/30/10 portfolio improves the Sharpe ratio from 0.346 to 0.482 while increasing volatility by 3.3 percentage points. The outcome depends on the return and correlation assumptions. A holding you can keep through a difficult period may matter more than the highest modelled ratio.

Methodology

Expected returns and volatilities from J.P. Morgan's 2026 Long-Term Capital Market Assumptions (30th edition, dollar edition). Correlations are measured from the assets' own monthly returns rather than read from a published table. Bitcoin uses your selected 15% geometric return scenario and Portfolio Lab's 42.5% volatility assumption. These are not J.P. Morgan Bitcoin forecasts. Read our methodology.

Sharpe Ratio = (Portfolio arithmetic return − Risk-Free Rate) / Portfolio Volatility. Risk-free rate: 3.1% (US Cash, JPM LTCMA).

The stress calculation multiplies each starting weight by its scenario return and adds the contributions. It has no recovery path, trading, tax or rebalancing assumption. A drawdown path requires a separate historical or simulated analysis.

Returns are forward-looking assumptions; correlations use historical monthly returns. This is an asset-class model, not a fund forecast. Past performance does not guarantee future results.

Read the full analysis: How Much Bitcoin Should Be in Your Portfolio?

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Portfolio Lab includes Max Sharpe, Min Variance, Risk Parity, Black-Litterman, Monte Carlo simulation, and backtesting back to 1926, on the published forecasts of J.P. Morgan, BlackRock, Research Affiliates and AQR, averaged and marked to today's prices.

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