What professionals say you should be saving in Bitcoin
🔸 Plus: A picture of a rock sold for $700,000 🔸 Employers are using AI to monitor what employees type in Slack 🔸 “Tooth fairy inflation” 🔸
Hello! Here’s today’s 2-minute guide to demystifying money and making you richer
How much of your savings should be in Bitcoin?
Companies are giving job applicants a personality test hosted by a blue alien named Ash.
A picture of a rock sold for $700,000.
Most people would give part of their pay to end global warming.
Employers are using AI to monitor what employees say in Slack.
Parents are being hit by “tooth fairy inflation”.
One woman’s story of how she lost $50,000 in a scam.
The markets, year-to-date
S&P 500: 5,117.09 ⬇️ 0.65%
FTSE 100: 7,727.42 ⬇️ 0.8%
Bitcoin: $67,659.30 ⬆️ 53.17%
GBP to USD: $1.2742 ⬆️ 0.11%
GBP to EUR: €1.1697 ⬇️ 0.016%
Based on Friday’s close of business.
How much the professionals say you should put into Bitcoin
The price of Bitcoin is up — again — setting a new all-time high at $73,135 earlier this month. Bitcoin has gained more than 50% in value this year.
So how much of your savings do professional investment managers think you should be plunging into Bitcoin?
The answer may surprise you: not much.
Big-name-brand managers are recommending only 1% to 3% of your investment savings should be in Bitcoin. Three percent would be “aggressive”, the pros say.
A vibe change in the investing world
We’ve told you before to be very cautious about investing in crypto. But there has been a vibe change in the investing world since the US government changed the rules this year to make it easier for Americans to invest in “Bitcoin ETFs”.
Bitcoin ETFs aren’t available in the UK, yet.
But it’s a matter of time before they arrive. The London Stock Exchange is likely to approve Bitcoin and Ether exchange-traded notes, which are similar, but reserved for institutional investors.
How a Bitcoin ETF works
“ETF” stands for “exchange-traded fund”. It’s simply an index, or list, of assets that can be bought as a bundle on any investment site.
Investment platforms — like banks or brokers — buy Bitcoin, put it into the ETF, and then their customers can buy a share of the ETF that reflects Bitcoin’s price on a 1:1 basis.
Previously, to buy Bitcoin, you’d have to go to an offshore crypto exchange or create a crypto “wallet”. That is sometimes complicated, especially for people who are new to crypto. Now customers can buy Bitcoin alongside any other type of stock, bond, or mutual fund without having to worry about crypto-weirdness like “seed phrases” or “cold-storage custody”.
In January, the US Securities & Exchange Commission allowed a dozen or so traditional asset managers to begin offering Bitcoin ETFs. Some famous names got permission: BlackRock, Invesco, Fidelity, and Franklin Templeton; along with a bunch of more obscure ones.
New money, new allocations
The arrival of new money from customers attracted by the safety of investing via the likes of Fidelity and Blackrock (instead of Kraken or Binance) is one of the factors currently pushing up the price of Bitcoin.
But the ETFs created an interesting new problem: The investment professionals employed by those ETF managers had to come up with sensible recommendations for customers who they previously told were taking enough risk with a traditional 60/40 mix of stocks-to-bonds.
Here’s the investment industry’s verdict
No more than 3% of your savings should be in Bitcoin.
Between 1% and 3% will give you all the excitement of Bitcoin’s frothy potential while not adding significant risk to your savings. (Crypto has a tendency to go belly-up, very suddenly.)
You can see Invesco’s 1% recommendation here.
Fidelity is recommending 2% or 3% here.
Bitwise is suggesting 2.5%, according to the Axios Crypto email newsletter (not online).
What does this mean for you?
Professionals are recommending only a tiny allocation for Bitcoin
Only an absolute moron puts all their money into crypto.
Only invest in crypto if you can afford to lose everything you put in.
If you’re feeling lucky and you want to ride this wave … do so in moderation. Do NOT bet all your money on crypto. Maybe just a little bit.
In the long run, the people who get rich — and stay rich — tend to have their money in stocks and property and they keep it there for years.
You can get better, safer results by being a lazy investor. Put your money into the S&P 500 or the Nasdaq — and go to sleep for 20 years. You’ll be fine.
And for dessert …
Companies are forcing job applicants to take a long, weird, AI personality test hosted by a blue alien named Ash. McDonald’s, Wendy’s, and FedEx believe the alien tells them how candidates rank in terms of “agreeableness” and “emotional stability.”
A picture of a rock sold for $700,000. It was an NFT, of course.
69% of people would give 1% of their salary to solve global warming. The survey covered 130,000 people globally.
Employers are using AI to spy on what you write in Slack. The software is called Aware, and it monitors employee sentiment. Companies using it include Nestle, Walmart, Delta Air Lines, and Starbucks.
American parents are being hit by “tooth fairy inflation”. The average value of a lost tooth hit $6.23 this year, up from $5.36 in 2022.
A financial advice columnist describes in excruciating detail how she lost $50,000 in a scam. Brutal and heartbreaking long-read on how one woman was tricked out of her savings.
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Photos: Kkhrbcc3e via Gencraft; Aware; NBC/SNL via Giphy.