Cathie Wood is not afraid to make bold predictions.
In early 2018, the owner of Ark Invest said that Tesla shares would go from $ 300 to $ 4,000 in five years, a potential rise of around 1,200%.
However, Tesla hit the mark early. This January, Tesla shares topped the $ 800 mark, or $ 4,000 on an adjusted divided basis.
Pretty staggering, but Tesla may not be Wood's most optimistic decision at the moment. Last month, he told CNBC that the price of Bitcoin could soar to half a million dollars in five years.
โIf we are right and companies continue to diversify their cash into something like Bitcoin, and institutional investors start allocating 5% of their funds in Bitcoin [...] We believe that the price will be ten times higher than the current one. Instead of $ 45,000, more than $ 500,000, โhe said.
Bitcoin is already moving in that direction; the cryptocurrency is trading at around $ 62,000 at the time of writing.
Here are a couple of ways to play the crypto boom, even if you're only dabbling in a few of the your "spare change".
Bitcoin ETF
Wood herself offers a new way to invest in cryptocurrencies. In September, Ark Next Generation Internet ETF modified its prospectus to include exposure to Bitcoin through Canadian ETFs.
The first bitcoin ETF on the New York Stock Exchange only started trading last week, but Canada has been ahead of the US for a while. Several Bitcoin ETFs launched in Canada this year, including Purpose Bitcoin ETF, 3iQ CoinShares Bitcoin ETF, CI Galaxy Bitcoin ETF, and Evolve Bitcoin ETF.
In the US, the debut of the ProShare Bitcoin Strategy ETF was arguably a major catalyst behind Bitcoin's latest rally. The fund maintains bitcoin futures contracts that are listed on the Chicago Mercantile Exchange.
Investors who want to get exposed to the crypto market can invest in these ETFs, but you can also buy Bitcoin outright. Some investment apps allow you to buy both cryptocurrencies and ETFs No commissions.
Cryptocurrency stocks
Companies that have joined the crypto market provide another way for investors to profit from the cryptocurrency rally.
For example, business software company MicroStrategy bought 9,000 bitcoins in the third quarter. That brings its total bitcoin count to 114,042, a reserve worth roughly $ 7 billion.
Due to MicroStrategy's huge Bitcoin stake, some investors have used it as a proxy to invest in the cryptocurrency. In the past, rallies in Bitcoin generally led to similar movements in MicroStrategy's share price.
Then there's Riot Blockchain, which mines Bitcoin and hosts Bitcoin mining rigs for institutional clients. Thanks to the rise in Bitcoin prices, Riot shares have registered a staggering 577% in the last 12 months.
Investors can also check out Coinbase, which operates the largest cryptocurrency exchange in the U.S. The company's share price fell below its $ 250 IPO price over the summer, but the recent emergence of cryptocurrencies has taken it back to over $ 300.
And while crypto stocks can be expensive, you can get a share of these companies using a popular app that lets you buy fractions of shares with all the money you are willing to spend.
A 'finer' alternative?
At the end of the day, cryptocurrencies are volatile. Not everyone is comfortable with an asset that seems to make wild changes every week.
If you want to invest in something that has little correlation with the ups and downs of the stock market and the crypto market, you may want to consider an asset that is overlooked: the fine arts.
Contemporary artworks have already outpaced the S&P 500 by a whopping 174% in the past 25 years, according to the Citi Global Art Market chart.
Investing in art from artists like Banksy and Andy Warhol used to be an option only for the ultra-wealthy, like Wood. But with a new investment platform, you can invest in iconic artworkalso, as do Jeff Bezos and Bill Gates.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
