Morgan Stanley Advises Up To 4% Portfolio Bitcoin Allocation

Morgan Stanley’s Global Investment Committee has formally recommended that clients allocate between 2% and 4% of their portfolios to bitcoin and crypto.

The new report, issued on October 1, outlines crypto (primarily bitcoin) allocations based on investor risk profiles. Opportunistic growth portfolios, which target higher-risk and higher-return strategies, should include up to 4% in crypto, while balanced growth portfolios are capped at 2%, the report read.

The committee who wrote the report characterized bitcoin as a scarce asset comparable to digital gold, suggesting that it now occupies a legitimate role within diversified investment strategies. 

“We place the emerging asset class within real assets and focus our commentary here primarily on bitcoin, which we consider a scarce asset, akin to digital gold,” the report read. 

While Morgan Stanley acknowledged the asset class’s historical volatility and potential for high correlation with broader markets during stress periods, it also noted that crypto’s total returns and structural maturity have improved in recent years.

Morgan Stanley: Buy crypto ‘every quarter’

Morgan Stanley said that clients  should regularly rebalance their multi-asset portfolios to include crypto — ideally every quarter, or at least once a year.

“Such rebalancing will dampen the potential for swelling positions, which could mean outsized portfolio-level volatility and cryptocurrency risk contributions in periods of macro and market stress,” the report read. 

The report recommended gaining exposure through exchange-traded products to manage volatility and prevent portfolio distortion during strong uptrends. The approach indicates a measured but open stance toward integrating crypto within traditional investment frameworks.

The announcement coincided with bitcoin reaching a new all-time high of roughly $126,200 today. The move extended a nine-day rally, supported by spot ETF inflows and a weakening U.S. dollar amid renewed government shutdown concerns.

Morgan Stanley’s latest guidance follows its September decision to expand digital asset access through its E*Trade platform, enabling trading in bitcoin and other crypto via a Zerohash partnership.