A modest allocation to bitcoin would have significantly improved returns on the traditional 60/40 portfolio, according to a research paper from Bitwise, a crypto index fund manager. For example, adding a 2.5 percent bitcoin allocation with quarterly rebalancing would have improved the cumulative return of the portfolio to 148.09 percent.

Naturally, bitcoin’s portfolio impact scales with the size of the allocation: A 5 percent allocation to bitcoin would have boosted the cumulative return of the portfolio to 210.63 percent, more than doubling the total return of the traditional portfolio.

The report examines the impact of adding a bitcoin allocation to a traditional diversified portfolio of stocks and bonds, a traditional 60/40 portfolio. Specifically, the portfolio examined features a 60 percent allocation to the Vanguard Total World Stock ETF (VT) and a 40 percent allocation to the Vanguard Total Bond Market ETF.

VT holds a market cap-weighted portfolio of gl