• Investing
  • Stock
  • Editor’s Pick
  • Economy
The Significant Deals
Investing

Bitcoin is just another tech stock, not a market hedge, study shows

by March 25, 2025
written by March 25, 2025

Bitcoin is more closely correlated to the Nasdaq than it is to gold most of the time, and investors could benefit from viewing it as another big tech stock, says Standard Chartered.

Bitcoin’s correlation with the Nasdaq is currently at about 0.5, after it approached 0.8 earlier this year, according to the bank. Meanwhile, its correlation with gold has been falling since January, touching zero at one point, and is now just above 0.2.

“Bitcoin trading is highly correlated to the Nasdaq over short time horizons,” Geoff Kendrick, Standard Chartered’s global head of digital assets research, said in a note Monday. “This Nasdaq correlation leads to the idea that bitcoin could be included in a basket of large tech stocks; if it were included, the implication would be more institutional buying as BTC would serve multiple purposes in investor portfolios.”

Bitcoin is frequently viewed as “digital gold” and a hedge against risks facing the traditional financial sector. Kendrick said he still sees the flagship cryptocurrency serving that purpose but that “in reality … the need for such hedges is very infrequent.”

Standard Chartered created a hypothetical index dubbed “Mag 7B,” in which it added bitcoin to the Magnificent 7 tech stocks — Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla — and removed Tesla.

“Mag 7B has outperformed Mag 7 by about 5% over the period since December 2017,” he said. “On a calendar year basis, Mag 7B outperformed Mag 7 in five out of seven years, albeit by a very small margin in 2022. Mag 7B’s relative returns are decent on both an absolute basis (averaging around 1% a year above Mag 7) and a calendar-year basis.”

Kendrick said bitcoin has been trading in a similar volatility-adjusted fashion to Nvidia since President Trump’s inauguration. They’re down 16% and 12%, respectively, since Jan. 20. Meanwhile, Tesla, which has lost 36% in the same period, is trading more like ether (down 38% since Jan. 20).

“Investors can view bitcoin as both a hedge against [traditional finance] and as part of their tech allocation,” Kendrick said. “Indeed, as BTC’s role in global investor portfolios becomes established, we think that having more than one use will bring fresh capital inflows to the asset. This is particularly true as bitcoin investment becomes more institutionalized.”

Bitcoin is down about 5% for the year after Trump’s tariff threats in recent weeks have brought new volatility to the market. Investors are expecting relief in the second quarter, however, given bitcoin’s two of its most persistent correlations: its positive correlation with money supply growth, also known as M2, and its negative correlation with the U.S. dollar index, or DXY.

—CNBC’s Michael Bloom contributed reporting.

This post appeared first on NBC NEWS
0 comment
0
FacebookTwitterPinterestEmail

previous post
23andMe files for bankruptcy as co-founder Anne Wojcicki resigns as CEO
next post
‘Eat now, pay later’? DoorDash-Klarna deal fuels concerns around loans for takeout

You may also like

McDonald’s Snack Wrap is officially returning. Here’s when.

June 4, 2025

Peloton launching resale market for used bikes, treadmills

June 4, 2025

Dollar General is shaking off tariff fears and...

June 4, 2025

McDonald’s Snack Wrap is officially returning. Here’s when.

June 3, 2025

Tesla’s robotaxi launch in tech-friendly Austin has Musk...

June 3, 2025

Uber delivery chief Gore-Coty is leaving after almost...

June 3, 2025

Elon Musk’s Neuralink raises $650 million in fresh...

June 3, 2025

Byron Allen puts broadcast TV stations up for...

June 3, 2025

U.S. foreign tax bill sends jitters across Wall...

May 30, 2025

Amazon taps Xbox co-founder to lead new team...

May 30, 2025
Fill Out & Get More Relevant News








    Stay ahead of the market and unlock exclusive trading insights & timely news. We value your privacy - your information is secure, and you can unsubscribe anytime. Gain an edge with hand-picked trading opportunities, stay informed with market-moving updates, and learn from expert tips & strategies.

    Recent Posts

    • McDonald’s Snack Wrap is officially returning. Here’s when.

      June 4, 2025
    • Peloton launching resale market for used bikes, treadmills

      June 4, 2025
    • Dollar General is shaking off tariff fears and winning over higher-income consumers

      June 4, 2025
    • McDonald’s Snack Wrap is officially returning. Here’s when.

      June 3, 2025

    Categories

    • Economy (245)
    • Editor's Pick (3,646)
    • Investing (497)
    • Stock (6,426)

    Latest News

    • McDonald’s Snack Wrap is officially returning. Here’s when.
    • Peloton launching resale market for used bikes, treadmills

    Popular News

    • Getty Images and Shutterstock agree to $3.7 bn merger, lifting shares
    • Trump to interview Warsh, Rowan for Treasury job on Wednesday, Bloomberg News reports

    About The Significant deals

    • Privacy Policy
    • Terms & Conditions

    Copyright © 2025 thesignificantdeals.com | All Rights Reserved

    The Significant Deals
    • Investing
    • Stock
    • Editor’s Pick
    • Economy