Bitcoin vs Gold

Disclaimer: I hold lots of both

https://www.buybitcoinworldwide.com/bitcoin-price-in-gold/

There is to me a false dichotomy about holding either gold or bitcoin as a Store of Value (SoV). I am not really a gold bug. I am more a #bitcoin bug.

Before 2020 I never really considered either gold or #Bitcoin. I was an avowed equities bug.

I set up my pension fund in 1992 and invested 100% in global index funds. No individual stock picking for me — not clever enough…. No factor biases, no size biases, simply the developed equities in the larger markets and 5% into emerging markets.

And asset allocation between the country index funds was HARD. But I decided on from memory 65% in my home market and the rest by capitalisation weights.

Bonds?…..Naw, I was 45 years old. I could stand some equity market buffeting before my retirement.

Rebalancing back to that weighting?…..Naw, I am a lazy bugger and fancied fire and forget.

So I have not touched it for 20 years. No trading at all. Nothing. Nada!

Some years I didn’t look at the valuations at all.

Now, for interest, it is 50% in the UK and 26% in the USA….

Those were the days my friend.

With equity valuations where they are now, and with new wealth in September 2021, 100% equities was no longer a sensible option.

We had just come through the first of 3 lockdowns in the UK. I had seen a huge land transaction delayed in completion by six months due to COVID. The Prime Minister had been in intensive care. Even pre-COVID I had started to think that some gold coins made sense in case of GFC 2 or other Armageddons….

I ended up buying a total exposure of what is now £530k of precious metals — 88% of which is gold. All in coin of the UK realm to avoid CGT.

This has cost me -3.3% performance hit over the past year at my total fund level!

My mainly bitcoin crypto is now worth £1,650k and has contributed +27.6% at the total fund level.

When I bought both gold and bitcoin in late September 2020 I could have bought a bitcoin with 6 grams of gold. Now it would cost me 25 grams.

Am I disappointed I bought my gold? No, its there for when and if bitcoin does its thing and drops to $9k and equities come off 50%! It’s a diversifier.

And if the s**t really hits the fan, and there is no internet (for a while, or forever) I have some accessible silver and gold coins with which to buy diesel or medicines (or toilet paper!).