The investment firm took Bitcoin out of its primary portfolio models due to volatile returns and uncertain correlations.
- JPMorgan sees annualized 10-year Bitcoin returns at 10%, better than U.S. stocks, REITs, and gold.
- Bitcoin’s projected volatility is 55%, which is higher than stocks and gold, despite an arithmetic average return of 20.9%.
- However, JP Morgan said the forecast was not a price target or a guarantee of outperformance, but a long-term planning tool.
J.P. Morgan Asset Management, the investment arm of JPMorgan Chase & Co. (JPM), has predicted Bitcoin (BTC) will outperform U.S. large-cap stocks, real estate investment trusts and gold in terms of annualized returns over the next decade. But the 10% return forecast is tied to 55% annualized volatility in the firm's 2027 Long-Term Capital Market Assumptions, which is why it still doesn’t include Bitcoin in its core portfolio allocation models.
The company expected Bitcoin’s base-case annual return of 10% over 10 years in its 2027 Long-Term Capital Market Assumptions. That compares with 7.5% for U.S. large-cap stocks, 8.2% for U.S. real estate investment trusts (REITs) and 5.5% for gold. This is the 31st year of the report, but it has never put a range on Bitcoin returns.
But the firm still considers the cryptocurrency too volatile for core portfolios.
JPMorgan gave Bitcoin an arithmetic return of 20.9%, which is the simple average of yearly gains. Its estimated annual volatility for Bitcoin stands at 55%. U.S. large caps, by comparison, hold 18%, said the report. Those swings take down the compound return, which is what an investor actually gets to keep over time.
JPMorgan’s Bitcoin Scenarios Range From Annual Loss To Gain
The report states the base case is a blend of three models. Global money growth is compared to Bitcoin supply. Another views it as a complement to gold. A third watches how the Bitcoin network is used. JPMorgan gave them a weight of 65%, 30%, and 5% according to its confidence in each.
The bear case is a loss of 11.2% per year, and the bull case is a gain of 16.6% per year. All three scenarios begin with a Bitcoin price of $83,000, as of Sept. 30, 2026. Previously, Fidelity's Jurrien Timmer predicted that Bitcoin would outpace gold, despite being bullish on gold’s growth and seeing its fair value at $5000.
Why JP Morgan Is Keeping Bitcoin Out Of Core Portfolio Models
But JPMorgan left Bitcoin out of its main covariance matrices even after the new forecast. Instead, it built a smaller, independent matrix. It seemed too early to consider BTC as a diversifier in a balanced portfolio, the report said.
Bitcoin’s correlation to other assets also remains in flux, it said. According to the report, Bitcoin had a correlation of 0.33 with U.S. large caps and 0.10 with gold. A reading of 1 would mean the two are in perfect lockstep.
The firm also rejected the idea that a debasement in the value of money, or debasement of currency, could lead to a rush into crypto. It called Bitcoin a speculative asset and a hedge against monetary easing. The report said that view could be overturned.
According to JPMorgan, Bitcoin could play a larger role as volatility decreases, correlations stabilize, and regulation becomes clearer. Until then, the firm said any allocation should be stress-tested against both its bull and bear scenarios.
Retail Sentiment For BTC Is ‘Extremely Bearish’
Bitcoin’s price was trading in the $81,400 range, down over 1% amid broader market pressure. On Stocktwits, retail sentiment around BTC remained in the ‘extremely bearish’ zone, amid ‘low’ chatter levels over the past day. According to platform data, watchers for the apex cryptocurrency have dropped 69% over the course of a year.
Read also: SKHY Stock Slides Premarket: Retail Eyes Buying Opportunity As Rival Micron’s Taiwan Strike Plan Adds Uncertainty To Memory Trade
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
