Published: 11.04.2022
Article reading time:
2 minutes.
The big investor and star of the Shark Tank show is positive about the future of the crypto industry and believes that digital assets will become the 12th sector of the economy in the S&P 500 index.
Now the main US stock index includes companies operating in 11 industries. But, according to Business Insider, citing Kevin O’Leary, the investor expects cryptocurrencies to expand the index. Experts advise not to place more than 20% of the investment portfolio in companies of the same sector of the economy, and no more than 5% in the shares of one company. In the event that crypto companies do enter the S&P 500 in the future, investors will have a much wider choice. In addition, shares of cryptocurrency companies can act as a hedging asset, the investor believes.
O’Leary said he now holds 32 different cryptocurrencies and tokens in his portfolio, including Solana, bitcoin and Polygon tokens. The investor limits the share of cryptocurrencies to no more than 20% of the portfolio, and no asset in his portfolio exceeds 5% of the total amount. The investor expects stocks of companies from the crypto industry to enter the S&P 500 index in the next decade.
“Bitcoin is not just a coin, it is software. So are alcoins. If you believe that software can have long-term economic value, you can allocate up to 5% of your operating budget. The largest investments I have made are in assets that I think have excellent economic prospects,” explains Kevin O’Leary.
The investor reminded that the maximum diversification of the investment portfolio is necessary. No one knows how the assets will behave in the future, but at the same time, only one or two assets from the whole portfolio can pull it into profit.
O’Leary also revealed that he has not yet purchased any virtual property in the metaverses. We need to first see which platforms and kinds of metaverses catch on, he says.
At the beginning of the year, the star of the Shark Tank show said that NFTs could become more in demand than bitcoin.
Source: Bits
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