Cryptocurrencies for investment use: Risks and returns

In this study, in which the effects of cryptocurrencies on portfolio risk and return are measured and interpreted; The usability of cryptocurrencies as a useful portfolio tool for investors was researched, investigations were made for their use as active currency and performance measurements were made with various portfolio contents. In this context, as the universe and sample, the three cryptocurrencies (Bitcoin, Ethereum, Ripple) with the highest transaction volume in the crypto money markets as of the end of 2018, the three exchange rates with the highest transaction volume (Dollar, Euro, British Pound) in our country. Three indices (Borsa Istanbul XU100, Dow Jones Stock Exchange DOW30, German United Stock Exchange Index DAX) and three commodities with the highest trading volume (Gold, Brent Petrol, Egypt) were analyzed. Two control groups were formed with the data of the first 6 months of 2019 and 12 months of 2019 data of the same investment instruments. As a result of the analysis and literature review, the high volatility of crypto coins and their use as an investment tool rather than an exchange tool in accordance with their purpose of existence are observed as negative consequences for crypto currencies. However, it is understood that the opposite correlation they show when included in the portfolio content positively affects the portfolio in risk - return assessment and that high returns can be obtained with their performances.