Investor Ray Dalio recommends investors allocate 15% of their portfolios to a combination of gold and Bitcoin as a protective measure against escalating risks linked to increasing government debts and potential market downturns.
Dalio’s caution stems from his analysis of mounting U.S. government debt levels and expanded money creation strategies pursued by the Federal Reserve. He contends these factors introduce significant instability into financial markets.
The proposed 15% allocation, split between gold and Bitcoin, is positioned as a hedge against the potential depreciation of fiat currencies and broader economic uncertainties. Dalio views gold favorably due to its historical standing as a long-term store of value, though experts note it has exhibited considerable volatility over extended periods.
While acknowledging Bitcoin emerges as a hedge candidate offering distinct appeal, Dalio highlights its inherent high-risk nature. Risks associated with its transparency structure and underlying protocol potential require careful consideration.
Reacting to the suggestion, investment analysts like Laith Khalaf underscore the importance of balance. They warn that integrating Bitcoin into a portfolio strategy should be carefully moderated with substantial holdings in traditional assets such as shares and bonds, emphasizing portfolio diversification and risk management.