The S&P 500 is a stock market index that tracks the performance of 500 of the largest publicly traded companies in the United States. It's widely considered the best gauge of large-cap U.S. equities and overall stock market performance.
Why Compare Bitcoin to the S&P 500?
Comparing Bitcoin to the S&P 500 helps investors understand Bitcoin's performance relative to traditional stock market investments. While the S&P 500 represents established companies, Bitcoin represents a new digital asset class with different risk/reward characteristics.
Interpretation:
Bitcoin has significantly outperformed the S&P 500 since 2010, though with much higher volatility. This comparison helps investors understand the trade-offs between traditional equities and digital assets.
