JPMorgan Asset Management has included Bitcoin in its long-term capital market assumptions for the first time, projecting a 10% compound annual return over a 10-to-15-year horizon. The projection, published October 19 in the firm’s 2027 Long-Term Capital Market Assumptions report, covers more than 200 asset classes and places Bitcoin above several traditional benchmarks.
The bank’s modeled return for Bitcoin compares with 7.5% for U.S. large-cap stocks, 8.2% for U.S. real estate investment trusts and 5.5% for gold. The report also lists a 20.9% arithmetic average annual return for Bitcoin, though JPMorgan emphasizes that compounded return is more relevant for how value accumulates over time after volatility and drawdowns.
That volatility is significant. JPMorgan models Bitcoin’s annualized volatility at 55%, roughly three times the 18% assumption for U.S. large-cap equities and well above the 17.2% estimate for gold. Despite the higher return forecast, Bitcoin remains outside the firm’s main covariance matrices for long-term portfolio construction because of its volatility and unstable correlations with conventional assets. Instead, JPMorgan uses a separate, smaller matrix to examine Bitcoin alongside selected public-market assets.
Bitwise Chief Investment Officer Matt Hougan highlighted the forecast on October 20, saying it shows how institutional views on Bitcoin are changing. Hougan added that in his opinion JPMorgan’s volatility estimate may be too high and its return estimate too low. JPMorgan’s assumptions are intended for long-term planning and are not short-term market calls. For context, the firm projects a 7% annualized return for a traditional 60/40 U.S. dollar portfolio and about 7.5% for a portfolio with 30% in diversified alternatives.
