On January 1, 2022, two investors each placed the equivalent of $46,000 in a market neutral strategy delivering 5% over the year. By December 31, the one measuring returns in bitcoins had lost 62% of his capital in dollars, as bitcoin fell 64%, while the other gained 5% in dollars. In 2023, roles reversed: the same 5% in bitcoins was worth 168% more in dollars, as the price multiplied by 2.6. For a French investor, a dollar-neutral strategy is not euro-neutral: in 2025, 5% earned in dollars became a loss of approximately 7% once converted, as the dollar fell 11.6% against the euro over the year. The right accounting currency depends on the investor’s future expenses, and before comparing two performances, it is essential to know in which currency each figure is calculated and whether it is hedged.
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