Banks should focus on blockchain technology and investors should increase their bitcoin holdings while trimming gold exposure, according to Jefferies Global Head of Equity Strategy Christopher Wood.
- “This concept of how it has begun to eat conventional finance is why all banks should be focused on the technology to see how to try and profit from it rather than to wait and be disrupted by it,” Wood said in a note on Thursday.
- The strategist also noted that if blockchain technology disrupts the conventional finance sector by eliminating the need for intermediaries, it can also potentially trigger the end of the “dollar paper standard.”
- He will be adding another 5% to his bitcoin exposure, bringing it to 10%, while cutting 5% exposure to gold in his global, long-only asset allocation portfolio recommendation for his U.S.-dollar-based pension funds.
- His portfolio recommendation currently has 40% gold, 30% Asia ex-Japan equities, 20% unhedged gold mining stocks and 10% bitcoin exposure.
- Wood is not putting Ethereum in the fund portfolio, as it is not a “store of value” asset, although he expects the second-largest cryptocurrency to outperform bitcoin in coming months.
Read More: Jefferies’ Wood Cuts Gold Exposure in Favor of New Position in Bitcoin
