ESG equities and Bitcoin: responsible investment and risk management perspective

Abstract

Bitcoin is often criticized for excessive electricity consumption and resulting carbon footprint. We use wavelet analysis to examine its interconnectedness with environmental, social, and governance (ESG) equities. The results indicate their comovements are low. We further compute the optimal ratio and show that Bitcoin significantly reduces portfolio risk when combined with green stocks. Our findings are robust to alternate specifications. From an environmental perspective, this investment strategy offsets the negative impacts of bitcoin mining, providing a remedy to sustainability-conscious investors' dilemma of the economic payoff of Bitcoin versus adherence to green investment philosophy.

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 25 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.