Regulatory and macroeconomic concerns have weighed heavily on cryptoassets this week, with Bitcoin and Ethereum trading sideways on cautious market sentiment.
Wall Street’s top cop Gary Gensler, head of the Securities and Exchange Commission (SEC), has requested more resources for cryptoasset oversight, while protestors in El Salvador have been marching against the new Bitcoin law. Adding to the uncertainty, the collapse of Chinese property developer Evergrande is threatening to send shockwaves through global markets.
Focus: Commodities at a crossroads
Commodities are at a crossroads after a big 26% rally this year, with risks from China’s slowdown and virus third wave. We see Chinese demand stabilizing and green-transition impact picking up. Commodities have a rare sweet-spot of strong demand, tight supply, and rising investor demand, on inflation and weaker USD outlooks. This is seen in the recent NatGas and Aluminium surges, for example. We favour industrial metals, energy, and ag, with precious lagging. Related Smart Portfolios include @RenewableEnergy, @OilWorldWide, @GoldWorldWide.
Markets remain on edge
It was another nervy week, with cross-currents of better-than-feared US inflation…
The crypto market is gaining momentum, with Bitcoin once again smashing past the milestone of $50K as Ethereum rapidly approaches all-time highs above $4K.
Gains in both cryptoassets are being driven by ongoing adoption. This includes leaked images showing that Twitter is testing a crypto tipping service, and hints from Securities and Exchange Commission (SEC) chair Gary Gensler that a long-awaited Bitcoin ETF could finally be on the cards.
Focus: Diversification check-up
US equities have rallied hard, and we see lower returns ahead, putting a focus on diversification. But traditional investment alternatives like cash and bonds are even more expensive, and our investor survey shows many unsure of what to do, and not rebalancing regularly. We look at three equity alternatives to help lower risk and increase diversification, such as 1) defensive rather than disruptive tech (CopyPortfolio’s like @Four-Horsemen), 2) financials (with ETF’s like XLF) and international equities, and 3) equity styles — from high dividends (HDV) to mid-cap (MDY) and low volatility (SPLV).
Steady as she goes
After briefly crossing $50K, Bitcoin traded sideways last week as the crypto market fell into a late summer lull.
Smart contract platforms, which are benefiting from the booming trade of collectible avatars in the NFT market, were the biggest gainers. Though Ethereum stayed flat, Cardano hit an all-time high of almost three dollars before retreating, and Tezos spiked over 35% on the launch of a new non-fungible token (NFT) platform.
Focus: Asia in the spotlight
Asia is 60% of the world’s population, near 40% of GDP, and with GDP growth rates 2–4x those of western markets. It is as diverse as 1.4 billion person consumer giants China and India across to tech titans Taiwan and Korea, and the world’s 2nd largest equity market Japan. Despite this it has significantly underperformed global equities this year, especially hit by the covid virus 3rd wave and China’s tech crackdown. …
Bitcoin has once again passed the key milestone of $50K after a week that saw some of the biggest global corporations make moves on the digital asset market.
Retail giant Walmart posted a job for a crypto expert to investigate virtual payment options, Facebook announced that their crypto wallet is approaching its launch date, and Microsoft said it is considering using Ethereum to counter piracy. Meanwhile, the second-largest U.S. mortgage lender revealed plans to accept cryptoasset payments for home loans.
Focus: The thematic investing boom
Interest in investment themes, rather than traditional country or sector allocations, has boomed and has a long way to go. Performance has been strong, tech disruption rising and ESG issues more important. Thematic investing does have some unique issues, from diversification to volatility. Cleantech and digital transformation are the current focus, and younger investors have taken the lead. Our CopyPortfolios offer many thematic ideas, with top performers led by @ChinaCar, @Driverless, @FashionPortfolio, and @FuturePayments.
Resilient to overdue market volatility
Global markets were hit by some overdue volatility last week, as worries over global growth and…
The total value of the cryptoasset market has once again risen above $2 trillion, as altcoins including Cardano and XRP race to reclaim all-time highs.
This bullish price action comes in defiance of negative headlines. The Senate passed the infrastructure bill on Tuesday without changing the requirements for crypto tax reporting, and on the same day $611 million was stolen in the largest DeFi hack in history (though the culprit has since returned the funds). Nevertheless, traders were not concerned, and multiple altcoins are now flashing high double-digit weekly gains.
Focus: The retail investor ‘beat’
Retail investors are more important to global equity markets than ever before. Given this, we surveyed 6,000 retail investors across 12 countries to understand how they are investing, and what they are worried about. They see the main risk as inflation, and many are concerned about current equity market levels. Maybe because of this, portfolios are well diversified and include significant cash. Investors are looking to add to commodities and crypto-assets, as well as energy and real estate equity sectors — though tech remains everyone’s favourite.
Earnings the driver for more upside
The S&P 500…
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