The Global Head of Equity at Jefferies has cut his gold exposure while growing his bitcoin holdings.
He’s now reducing his gold holdings in order to increase his exposure to the world’s largest cryptocurrency.
Traditional financial institutions, such as banks, should focus on blockchain and exploit the technology, rather than waiting for it to cause a significant disruption, according to Wood, who also happens to be the global head of the investment banking giant.
Previously the firm has raised only 5% allocation on bitcoin when Bitcoin was $22K.
This isn’t the first time Wood has increased his Bitcoin holdings at the expense of his gold exposure.
ARRIVAL OF BITCOIN ETF MADE HUGE CHANGES
Jefferies’ global head of equity, for example, wasn’t always a fan of Bitcoin. He had previously avoided investing in cryptocurrency due to concerns about hacking.
Wood, like the majority of institutional actors, had a change of heart. While he remains positive on gold, he feels that ignoring the upheaval brought about by Bitcoin and other cryptocurrencies may be a mistake.
According to the Economic Times, the influential strategist wrote in a note to his clients that if blockchain technology succeeds in disrupting traditional finance by eliminating the need for third parties and intermediaries, it might also lead to the end of the “dollar paper standard.”
While drawing parallels between Bitcoin and gold, Wood recognised that the latter’s performance has been abysmal, particularly with negative interest rates in the United States.
In this regard, he believes the arrival in the country of the much-anticipated Bitcoin Futures ETF highlights the need for more global portfolio changes for US-dollar based pension funds created at the end of Q3 2002.
Currently, he recommends a 10 percent BTC exposure, 40 percent gold, 30 percent Asia (excluding Japan) equities, and 20% unhedged gold mining stocks in his portfolio.
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