Investment class from 2021: The increase in Bitcoin leaves gold in dust

Despite the accelerating inflation,

gold is one of the most important asset classes with the worst performance in 2021, since the shine of the precious metal has subsided next to what some viewed as its digital equivalent Bitcoin.

The precious metal, which is often advertised as inflation protection, has fallen by 5 percent this year, even if investors are looking for protection because consumer prices are increasing worldwide. In contrast, Bitcoin 2021 has a large, albeit volatile rally with an upgrading of 65 percent in the previous course.

Francisco Blanch, Stratege at Bank of America, said that the withdrawal of the Federal Reserve from the economic measures of the crisis period and the higher bonds in the USA would have caused “big headwind” for gold. A stronger dollar that makes the metal more expensive for international investors also burdened its performance, he said.

"Some streams that may have flowed in gold in the past may have flowed into crypto-assets," added Blanch. The allocation of digital assets from institutional investors has increased “on a broad front” in the past year and a half, he said.

Bitcoin enthusiasts see what they call “digital gold” as a bulwark against inflation and indicate its limited offer. However, cryptocurrencies such as Bitcoin and Ethereum were more like "risk systems" than ports, said Blanch, who, as a very volatile and increasingly "correlated with stocks and risks", described them through their increasing use in some investor portfolios.

The risk -adjusted returns from Bitcoin that make up the volatility, according to Goldman Sachs calculations, show much lower profits of 0.9 percent, lower than that of most other investment classes. His price fell by $ 10,000 in early December.

nikolaos Panigirtzoglou, cross -market analyst at JPMorgan, said that the high volatility of Bitcoin is "not incompatible" with a value retention thesis that "has more to do with the conviction that assets such as Bitcoin or Gold keep their value when something systemic action" or the financial system gets into a crisis. "

Elsewhere, US energy values ​​and the oil price developed strongly because the year was characterized by a reopening of the economy. "Monetary and tax support in connection with the introduction of vaccinations" increased the mobility of people and goods, which raised energy demand, said Gregory Perdon, Co-Chief Investment Officer at Arbuthnot Lathham.

Although the advent of the Omicron Coronavirus variant reveals doubts about the forecasts, the analysts remain optimistic. "We are much more happy about cyclical raw materials [Than Gold] because we think that the economic cycle will continue until next year," said Blanch.

Real estate shares also benefited from the reopening, whereby the S&P 500 sector added 41 percent to a total of trendite basis. According to the JPMorgan, real estate investment trust in the past has beaten public stocks if inflation and growth are either above average or over 3 percent.