Billionaire Paul Tudor Jones surprised many investors when he told CNBC on Monday: “I like bitcoin.”
Jones, who runs the $44.5 billion Tudor Investment Corporation, hailed the cryptocurrency as “a portfolio diversifier.”
He explained: “I like the idea of investing in something that is reliable, consistent, honest and 100% certain. So, bitcoin has appealed to me because it’s a way for me to invest in certainty.”
Jones also described how bitcoin and other assets fit into his investing strategy, saying: “I want 5% in gold, 5% in bitcoin, 5% in cash and 5% in commodities.”
He added that he “would go all-in” on bitcoin and other assets if the Federal Reserve doesn’t act soon to address rising inflation.
Read on to see why bitcoin needs to be a part of everyone’s portfolio, whether you’re a billionaire hedge fund manager or an everyday investor.
Bitcoin’s Incredible 5-Year Run
Bitcoin has had its fair share of dramatic ups and downs over the years.
In May, for example, the cryptocurrency’s price crashed 45% in a span of just two weeks.
But even after May’s volatility, bitcoin is still up over 8,800% since the start of 2016.
In comparison, gold is up only 70% over the same time frame.
That means one bitcoin is now worth over 21 times as much as an ounce of gold, as you can see in the chart below.
Bitcoin Price in Ounces of Gold: 2016–2021
(Source: Buy Bitcoin Worldwide.)
As for the stock market, it’s done better than gold has. The S&P 500 Index is up 110% since 2016.
Stocks are shown as the red line at the bottom of the chart below. Their returns are higher than average for a five-year period, but bitcoin’s gains make stocks look trivial.
Bitcoin (Blue) vs. the S&P 500 Index (Red): 2016–2021
(Source: Barchart.)
And forget about cash. The U.S. dollar has lost 12% of its purchasing power since 2016, according to Consumer Price Index data.
So, if you stored your money in a savings account for five years instead of investing it in bitcoin, then you really missed out.
Bitcoin Is Just 1 of Many Opportunities
Given bitcoin’s incredible long-term performance, it’s easy to see why Paul Tudor Jones and other billionaires are warming up to it.
It’s also a great time to buy bitcoin at a discount now that prices have dipped back below the $40,000 mark.
But bitcoin is just one of many opportunities in the crypto space. And Ian King is here to help you make the best investing decisions.
His Next Wave Crypto Fortunes service has all the resources you need to navigate the fast-paced crypto markets.
You can learn more about Ian’s crypto trading strategy by clicking here.
Regards,
Assistant Managing Editor, Banyan Hill Publishing