Yeah I agree. The "equivalent" thing would be the premium you tend to get from rebalancing assets with certain cross-sectional time-series properties - not the diversification (correlation) effect itself, I think.
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I don't understand. I assume zero geometric return for bitcoin above.
But you allocate less than 23% which means you are using an arithmetic return of less than 50%, hence a negative geometric return! (Also I am like 99% trolling 1% serious)
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I stopped making serious relies on this thread a loooooong time ago.
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One thing is that the above analysis assumes normal distributions of returns. Bitcoin is far from such. I've done simulations that tell me I don't need to worry too much about those fat tails but still it makes me allocate less than MVO suggests.
End of conversation
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LOL, I also don't leverage my portfolio to maximum geometric return. I do care about my drawdowns.
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Losers always whine about their “drawdowns”. Winners go home and fuck the prom queen.
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