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Cryptos are still very correlated with Equities for now. But what are the less correlated stuff?
By Investment Moats  •  January 23, 2022
I think one of the possible advantages of Bitcoin that will float into your brain is that if it behaves like Gold, then it can act as a diversifier. It can also reduce the volatility of your portfolio since gold has a very low correlation with general equities. But my observation is… cryptos do not behave like gold. After the initial plunge, gold tends to do better as an avenue for those who are reallocating their capital to safe-havens. But we are not observing the same thing based on recent history: Click to view a larger chart Here is a chart where I overlay the Nasdaq 100 (QQQ in blue) against Bitcoin (light green) and Ethereum (Orange) and Tail (yellow). Tail is an ETF made up of treasury bills and S&P 500 put options. You would observe that when the QQQ fall, sometimes the Bitcoin and Ethereum leads,...
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By Investment Moats
Investment Moats is set up by Kyith Ng and have been around since 2005. He aims to share his experiences making sense of money, how money works and ways to grow his money. It hopes that by sharing his experiences, both good and bad, season investors can advice and critique his decisions and new investors can learn from them and find their own style ...
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