Updated quarterly, our evolving views on the thematics shaping the markets around us

Gold & Bitcoin

WHY IT MATTERS | High levels of inflation can damage savings, the economy, and the ability to effectively plan their future. Store of value assets are asset classes such as gold or bitcoin that can potentially protect investors from inflation (i.e. preserve their purchasing power), and should thus benefit from significant inflows in the event inflation does pick-up.

THE TAKEAWAY | With money being thrown around like gifts at an Oprah Winfrey show, worries about inflation are (rightfully so) on the rise. Whilst it’s unclear if we will see a significant pick-up in inflation in the short-term, the medium and long-term outlook is definitely more threatened, which should generate increased focus around these two assets (and potentially other stores of value like Rembrandt’s and Beanie Babies).



  • Gold has been the “store of value” incumbent longer than Nicholas Cage has been doing conspiracy theory movies, and for good reason. Every year, we can only add new supply that corresponds to 2-3% of the total stock, and this “limited new supply” makes gold an asset that is always somewhat scarce (which helps it preserve value in a world of abundance). Currently, it’s in the midst of a bull market that started quietly a couple of years ago, exploded early on in 2020, and lost some steam towards the end of the year. It’s currently under-owned by pension funds and family offices (by historical standards), and given the current macro, political, social and public health risks, and the increased decline in real rates (nominal rates – inflation), gold should continue to perform well in the short to medium term.

  • Central banks have been increasing their exposure to gold since right after the Great Financial Crisis.

  • 2020 marked the resurgence of Bitcoin after the 2017 bubble and subsequent crash.



Inflation expectations | Everything related to inflation impacts the demand for store of value assets. It’s not the fear of inflation per se that drives demand for “store of value” assets (some level of inflation is good), but rather the fear of inflation spiraling out of control (i.e. significantly higher than 2% for an extended period of time).

New Allocations | 2020 saw several investors and institutions publicly disclosing an allocation (or increase of it) to store of value assets like gold, gold miners, and bitcoin. The public opinion on “store of value” asset classes matters because they are only as valuable as everyone believes them to be. Gold has little intrinsic or commercial value (c. 9% is driven by its industrial application and c. 49% is driven by jewelry demand) and bitcoin certainly has none, but if they are perceived as reliable mediums to store wealth, then its value is as high as the demand for it is willing to pay.