Bitcoin and gold have both recently reached record highs. If you were to pick between the two, which one would you prefer to own? Until recently, it was uncommon for Wall Street analysts and professional investors to seriously juxtapose the two assets.
Bitcoin, often dubbed digital gold, has traditionally been regarded as a speculative investment with inherent risk, appealing to those seeking short-term profits. Conversely, gold has consistently maintained its status as a safe-haven asset.
Well, the debate about whether bitcoin or gold is the better investment is complex. There are pros and cons to each asset, and the best investment strategy will depend on your circumstances and preferences. I engage with crypto assets and gold through funds and ETFs.
While I was having my breakfast this morning, I picked up an interesting article from Yahoo! Finance which may be of interest.
Here is a section:
Institutional investors and individuals have been buying both gold and bitcoin this year, not switching between the two, as some analysts have postulated, JPMorgan (JPM) said in a research report on Thursday.
Outflows from gold exchange-traded funds (ETFs) and a surge in bitcoin ETF inflows raised the possibility that investors were shifting from the precious metal into the cryptocurrency, the report said. The bank said it disagreed.
“Private investors and individuals have propagated both gold and bitcoin year-to-date rather than shifting from the former to the latter,” analysts led by Nikolaos Panigirtzoglou wrote.
“Beyond retail investors, speculative institutional investors such as hedge funds including momentum traders such as CTAs appear to have also propagated the rally by buying both gold and bitcoin futures since February, perhaps more heavily than retail investors,” the authors wrote.
The bank’s analysis shows a “sharp position build-up since February of $7B in bitcoin futures and $30B in gold futures.”