It’s Not a Choice Between Bitcoin and Gold
Amanda Heckman|April 10, 2021
What are you buying these days… Bitcoin or gold?
It’s a trick question.
We made an important point with our Modern Asset Portfolio this week…
That it’s not either/or when it comes to gold and Bitcoin. That kind of thinking can lead to trouble.
On Wednesday, Andy put on his gloves and took Jim Cramer to task for saying Bitcoin is better than gold.
Shortly after the ink was dry, we learned that Bloomberg’s latest data has Bitcoin replacing gold as the “preferred non-sovereign reserve asset in investor portfolios.”
It even used one of our favorite sayings in its Crypto Outlook published this week… That money is going where it’s treated best.
Because of the opportunity for big gains in crypto, we’re seeing massive inflows into Bitcoin… and outflows from gold.
Bloomberg concluded, “Gold will always have a place in jewelry and coin collections, but most indicators point to an accelerating pace of Bitcoin replacing the metal as a store of value in investor portfolios. Bitcoin’s fundamental and technical underpinnings are improving while gold’s deteriorate.”
That’s a dangerous way of thinking.
Yes, Bitcoin and its crypto friends are the hottest asset class around these days. (Just ask the crypto investors who made it onto the Forbes Billionaires list.)
Not to mention the crypto market hit a $2 trillion valuation this week… doubling in just two months. (And it’s well on its way to Andy’s big prediction of a $3 trillion price tag by the end of the year.)
Cryptos have proven to be an exciting and innovative new asset class with immense wealth-building potential.
You’d be crazy not to take part in it.
But here’s the thing… and what worries us about the trend Bloomberg sees…
You’d also be crazy not to be in gold.
Andy recommends a 10% allocation to cryptocurrencies… and a 10% stake in gold.
After all, he writes, “There’s a big difference between gold, Bitcoin and almost all other cryptos.”
They are two completely different assets.
They should not be looked at as competitors for space in your portfolio. They are on opposite ends of the risk spectrum.
While the future may be different, right now cryptos can play an important role in building your wealth. Gold’s role, on the other hand, is to protect your wealth.
It’s your insurance policy in case things go to hell.
It would be foolish to cash out that policy just because crypto has helped your portfolio to never look better.
Simply put… both assets are good buys right now.
But with the recent outflows from gold, now is the perfect time to buy against that trend.
So go ahead and add some insurance to your portfolio… and check out Andy’s favorite crypto play right here.
With both, you’ll give your portfolio a safety net and the chance to soar.
Amanda Heckman|Editorial Director
Amanda Heckman is the editorial director of Manward Press. With unrivaled meticulousness, she has spent the past dozen or so years – give or take a few sabbaticals – sharpening Andy’s already razorlike wit. A classically trained musician and a skilled writer in her own right, Amanda takes an artistic approach to the complex world of investing. Her skill has led her to work with numerous bestselling authors, award-winning financial gurus and – lucky for us – the fine folks at Manward Press.