JPMorgan projects an annualized return of 10% for Bitcoin over the next decade, outperforming U.S. equities, REITs, and gold. However, due to its excessively high volatility of 55%, the bank refuses to include it in core portfolios.
Zhitong Finance APP has learned that JPMorgan Asset Management predicts Bitcoin’s annualized returns will outperform U.S. large-cap stocks, Real Estate Investment Trusts (REITs), and gold over the next ten years. However, in its 2027 Long-Term Capital Market Assumptions report, this 10% return forecast is accompanied by a 55% annualized volatility rate, which is precisely why it is excluded from the core asset allocation model.
In the 2027 Long-Term Capital Market Assumptions, JPMorgan estimates a baseline annual return of 10% for Bitcoin over the next decade. By comparison, U.S. large-cap stocks are projected at 7.5%, U.S. REITs at 8.2%, and gold at 5.5%. This marks the 31st year of the report, but it has never previously established a return range for Bitcoin.
Nevertheless, the firm still considers the cryptocurrency too volatile to be included in core portfolios.
JPMorgan assigns Bitcoin an arithmetic return of 20.9%, representing the simple average of annual gains. It estimates Bitcoin's annualized volatility at 55%. The report notes that, by comparison, U.S. large-cap stocks have a volatility of 18%. Such volatility dampens compounded returns, which represent the actual long-term gains realized by investors.
JPMorgan’s Bitcoin Scenarios: From Annual Losses to Positive Returns
The report states that the baseline scenario is a blend of three models. One model compares global money supply growth with Bitcoin’s supply; another treats Bitcoin as a complement to gold; and the third examines usage of the Bitcoin network. JPMorgan assigns weights of 65%, 30%, and 5% to these models, respectively, based on their confidence levels.
The bear case assumes an annual loss of 11.2%, while the bull case assumes an annual gain of 16.6%. All three scenarios use a Bitcoin price of $83,000 as of September 30, 2026, as the starting point. Previously, Julian Tepper of Fidelity predicted that Bitcoin would outperform gold, although he remained bullish on gold’s upward trend and estimated its fair value at $5,000.
Why JPMorgan Excludes Bitcoin from Its Core Portfolio Model
Despite the new forecasts, JPMorgan continues to exclude Bitcoin from its main covariance matrix. Instead, it constructs a smaller, independent matrix. The report argues that it is premature to view BTC as a diversification tool within a balanced portfolio at this stage.
The report states that the correlation between Bitcoin and other assets remains volatile. According to the report, Bitcoin’s correlation with U.S. large-cap stocks is 0.33, while its correlation with gold is 0.10. A reading of 1 would indicate perfect synchronization between the two.
The firm also refuted the view that currency devaluation could trigger capital inflows into cryptocurrencies. It described Bitcoin as a speculative asset and a hedge against monetary easing, noting that this perspective may be overturned.
According to JPMorgan, Bitcoin is poised to play a larger role as volatility declines, correlations stabilize, and regulatory frameworks become clearer. Until then, the firm stated that any allocation should be stress-tested under both bull and bear market scenarios.