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An equities and derivatives strategist with a global financial services firm specializing in institutional trading believes bitcoin has a place in investment portfolios. It has a price target per bitcoin of $ 50,000 in 2021.
Bitcoin has a place in investor wallets
BTIG is a global financial services firm specializing in institutional trading, investment banking, research and brokerage services. The company has over 3,000 institutional and corporate clients around the world, according to its website. Its lead strategist in stocks and derivatives, Julian Emanuel, spoke about bitcoin in an interview with CNBC’s Fast Money earlier this week.
He was asked if bitcoin has a place in investors’ wallets instead of cash. The chief equity strategist replied: “It is not necessarily in place of money. Instead, the traditional 60/40 bond allocation would be 40%.
He explained that “if the Fed does not allow negative rates and they have spoken about it, and we are starting to see signs of inflation, it is reasonable to expect that you could have losses in bond portfolios in the near future.” The strategist continued: “when you combine that with the fact that you have this whole cohort of young investors, the same ones who aggressively pushed tech stocks this summer that have investment horizons of 40 years an alternative to bonds is very, very reasonable. “Emanuel he added:
From our perspective, as the Fed continues to increase its balance sheet and US debt continues to rise, bitcoin is a viable alternative.
He was then asked whether companies should consider keeping bitcoin instead of cash equivalents on their balance sheets.
“It is certainly, again, an alternative and we have seen many of them come to this conclusion and one of the facts of life is that you have not really been rewarded, and maybe it is right that you are, in this interest rate environment. zero for cash, “he replied. While stressing, “I don’t know I want to go that far because again this is an individual business management perspective,” he said:
In a diversified investment portfolio, we think there is a place for cryptocurrencies.
Bitcoin’s price target of $ 50,000 in 2021
Emanuel has a bitcoin price target of $ 50,000 by the end of 2021 which he believes is a reasonable price prediction.
To arrive at this price prediction, he compared the price of bitcoin to the Nasdaq 100 (NDX), which peaked in the dot-com bubble and then took years to reach that peak again.
“It took NDX 14 years to rise above its parabolic ‘blowoff top’, then 6 years to rise a further 150%,” he wrote, adding:
Bitcoin looks poised to surpass its parabolic 2017 blowoff top in just 3 years. Should bitcoin’s rate of rise keep pace with the past three years and the degree of the rally approaches that of NDX, $ 50,000 per bitcoin is a reasonable price target for the end of the year 2021.
What do you think of Julian Emanuel’s point of view on bitcoin? Let us know in the comments section below.
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