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Yahoo
5 hours ago
- Yahoo
Ric Edelman: Why Crypto Should Make Up 10%–40% of Your Portfolio
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Ric Edelman's views of how much of your portfolio you should allocate to the cryptocurrency sector have changed significantly. The famed financial adviser only suggested a 1% allocation to the cryptocurrency sector in 2021. Now, he says this allocation should be between 10% and 40%, depending on your risk appetite—10% for conservative investors, 25% for moderate investors and 40% for aggressive investors. 'Today, I'm saying 40%, that's astonishing, right?' he told CNBC last week. 'Nobody ever, anywhere has said such a thing as what I'm saying now.' Don't Miss: — no wallets, just price speculation and free paper trading to practice different strategies. Grow your IRA or 401(k) with Crypto – . There are two major reasons for the drastic change in Edelman's perspective. The first one, which appears seemingly unrelated to cryptocurrencies, is that humans are living longer. He said that the widely followed 60/40 portfolio with a 60% equities allocation and 40% allocation to bonds was made assuming that most people would retire at 65 and die at 85. But with people living longer as science advances with each passing decade, Edelman said investors needed more investment growth as they are likely to need money for longer after retirement. Edelman believes that the cryptocurrency sector presents the best growth potential of any asset class. He said the sector has outperformed all others in the past 15 years and was likely to continue doing so in the next decade. One reason for this is that adoption is 'still incredibly low,' he said. Trending: New to crypto? on Coinbase. 'It's only about 5% of the global population that own crypto at this stage,' he told CNBC. 'As more and more get involved, ... we're going to see massive asset inflows, and because certainly in the case of Bitcoin, it's a fixed supply asset, the more people who buy it, the higher the price is going to rise.' The second major reason Edelman is now comfortable with more significant cryptocurrency exposure is that he believes that a lot of uncertainty about the future of the asset class has now been resolved. 'Four years ago, we didn't know if governments were going to ban Bitcoin,' he told CNBC. 'We didn't know if the technology would become obsolete. We didn't know if consumers might not want to adopt it. We didn't know if there would be any institutional engagement. Today, all those questions are resolved.' He cited the Trump administration's overwhelming support for the asset class and the institutional and banking engagement over the past year. To be sure, leading investment managers like BlackRock (NYSE:BLK) and Fidelity have launched Bitcoin and Ethereum exchange-traded funds in the past year that have raked in billions of dollars in assets under management. Meanwhile, JPMorgan Chase (NYSE:JPM) CEO Jamie Dimon said in May that the bank would allow customers to buy these catalysts, Edelman sees blockchain technology growing to a $3 trillion sector in 2030 from $176 billion today. At the same time, he sees Bitcoin's market capitalization rising to $19 trillion from about $2.1 trillion today, which would see the asset hit $500,000. 'Thanks to the mainstreaming of crypto, there are now crypto allocation strategies that accommodate every risk tolerance and account type,' Edelman said in a white paper released in June. He pointed out that investors can opt for direct exposure through exchange-traded funds or indirect exposure through equity proxies like MicroStrategy (NASDAQ:MSTR). He also said that investors can allocate through the help of institutions with separately managed accounts or employ risk management strategies like dollar cost averaging. Read Next: Named a TIME Best Invention and Backed by 5,000+ Users, Kara's Air-to-Water Pod Cuts Plastic and Costs — Image: Shutterstock This article Ric Edelman: Why Crypto Should Make Up 10%–40% of Your Portfolio originally appeared on
CNBC
9 hours ago
- CNBC
Economist Nouriel Roubini sees a ‘mini stagflationary shock' coming in the second half of 2025
An economist and investor nicknamed "Dr. Doom" sees a rough patch ahead for the U.S. economy, but isn't advocating any panicked selling. Nouriel Roubini told CNBC that he expects the core personal consumption expenditures index — the Federal Reserve's preferred inflation metric — to reach about 3.5% by the end of the year, and economic growth to weaken and possibly turn negative. Best known for calling the 2008 Global Financial Crisis, Roubini said the second half will amount to "a mini stagflationary shock," and that the Fed will hold off on rate cuts until at least December. That view includes an expectation of a "mild" resolution to trade negotiations that ends with many countries facing a 15% rate, the economist said. "I'm not expecting, certainly, anything close to April 2," Roubini said, referring to the tariff levels announced by President Donald Trump that day that sparked a steep market sell-off. Roubini, a Harvard-trained economist, has a long track record in the academia, government and the private sector. The "Dr. Doom" moniker refers to numerous macroeconomic warnings he has issued throughout his career. His hit rate is not perfect, but he was early in warning about the financial crisis and a virus-induced recession in 2020. He is also one of the portfolio managers on the Atlas America Fund (USAF) , an ETF launched late last year that aims to guard against economic risks from structurally higher inflation to climate change. The fund is designed to be less volatile than the stock market but is "not a portfolio for doomsday," Roubini said. The fund is still small and thinly traded, with only about $17 million in assets, according to FactSet. But performance has been solid. The multi-asset fund has gained more than 5% since inception last November. That trailis the S & P 500 , but USAF has shown its defensive mettle, falling less than 3% in the days following the April 2 "Liberation Day" tariff announcements, when U.S. stocks soon fell roughly 20%. USAF 1Y mountain The Atlas America Fund saw a smaller drawdown in April than broad stock market indexes. "We don't particularly want outsized returns in one month. We'd rather have the slow and steady uptick, which is exactly what we've been seeing," said Puneet Agarwal, one of other portfolio managers for USAF. The portfolio, which includes large positions in gold, short-term U.S. government debt and exposure to agricultural commodities, has changed some since the fund's launch. USAF has recently added exposure to defense technology and cybersecurity stocks, and bought short-term inflation-protected bonds, while dialing back holdings in real estate, Agarwal said. The fund's large bet on gold helped it outperform the stock market earlier this year, but also contributed to USAF's relatively sluggish performance in June. Roubini said the bet on gold is part of a longer-term theory that the world is moving away from the U.S. dollar. "We're not expecting things to crash. But the trend is clear and it is going [in] one direction," Roubini said.
CNBC
15 hours ago
- CNBC
Trade deadlines and oil drama set the stage for a crunch week in global markets
CNBC's assignment desk has a conundrum this week: how to approach July, 9. Why does this specific date matter? It's the deadline for trade negotiations between the U.S. and European Union before the tariffs axe (maybe) falls once again. But President Donald Trump's tendency to move deadlines makes it tricky to commit to a big coverage plan when the date could become redundant. However — as we saw with the surprise framework agreed between the U.S. and China in Geneva back in April — you also can't afford to underplay the deadlines' significance. What we do know is that a full trade deal is "impossible" before the deadline, in the words of European Commission President Ursula von der Leyen, and that the best Brussels can hope for is an "agreement in principle." As CNBC anchor Silvia Amaro reported last week, the EU is banking on at least a bare-bones deal to show progress and avoid the 50% levy on products exported from the bloc. We should get some clues from Brussels on Tuesday and Wednesday, as European finance ministers gather for their regular meeting in Brussels. Another assignment that is much more definitive: the OPEC Seminar. The circus rolls back into Vienna as the oil producers' International Seminar takes place at the city's grand Hofburg Palace on Wednesday and Thursday. The meeting offers delegates two days of discussion and analysis on energy security and investment. It's a far cry from the days of the OPEC media scrum at the concrete headquarters on the other side of the Austrian capital. As a junior producer, I was lucky enough to cover OPEC with CNBC Anchor Steve Sedgwick. Before Covid, these manic biannual meetings saw journalists fight for soundbites from the world's most influential OPEC ministers. In those days, the scrum was affectionately known by a much less polite term… OPEC+ members — a wider group that includes non-OPEC oil producers, including Russia — meet this weekend to decide on another (highly anticipated) output hike amid a volatile month for crude prices. At the Seminar, ministers will also be joined by the CEOs of some of the world's largest energy companies, including BP and Shell. CEOs Murray Auchincloss and Wael Sawan will be the center of attention as market watchers and journalists alike look for any clues that a much-denied takeover could still be in the cards.
