Bitcoin ‘Is A Unique Beast As An Emerging SoV,’ Blending the Benefits of Tech & Gold: Ruffer Investment
“Bitcoin is becoming a challenger to gold’s standing as the one supra-currency,” wrote the chairman of the UK-based firm.
The UK-based traditional asset manager, Ruffer Investment, in its Q4 2020 investment review, talked about its decision to buy Bitcoin in length.
It was revealed last month that the company had allocated 2.5% of its portfolio, representing $675 million, into Bitcoin. The company decided to buy Bitcoin in November of 2020, with which they are “nervously satisfied.”
The reason behind this investment has been that “bitcoin is becoming a challenger to gold’s standing as the one supra-currency, the thing to own when fiat currencies are kerplunked,” wrote Chairman Jonathan Ruffer in the letter published on Tuesday.
The decision wasn’t made without assessment; the company has been, in fact, watching the digital asset for a “longish time.” And their assessment revealed that Bitcoin “is a unique beast as an emerging store of value, blending some of the benefits of technology and gold.”
Ruffer added, “Yes, it is a seemingly non-sensical asset – but one that makes absolute sense for how we see the world.”
In the letter, Ruffer talked about its investment philosophy, which aims to make substantial enough returns to justify uncertainties — a subject test made over the long haul — and try never to lose money on a rolling 12-month basis while keeping its investors safe.
This means choosing the assets for their investment portfolio that has the characteristic of being “capable of superior performance, both in favourable and adverse circumstances.”
And that is why they hold inflation-linked bonds because Ruffer expects “biggish inflation – ahead,” and gold because “the world’s currencies are in danger of being compromised by the issuance of more money.” Now, the company also holds Bitcoin, the best performing asset of the year and the decade.
The company also reported good growth in eight quarters in a row without a meaningful setback and talked about a changing of the guard being on its way, which means they are preparing for high taxes on capital gains, wealth, and income.