Wealth Managers Like Jim Paulsen Regret Not Having More Cryptocurrency In Portfolio: Reuters
What Happened: Regulatory constraints around cryptocurrencies are a cause for concern for wealth managers across the globe.
Jim Paulsen, Chief Investment Officer at the Leuthold Group that manages over $1 billion, is frustrated that he cannot purchase Bitcoin on behalf of its clients, Reuters has reported.
“What I like about bitcoin is… its correlation to stocks and other assets is extraordinarily independent,” said Paulsen.
Similar sentiments were expressed by the Chief Executive of Wealth Consulting Group, Jimmy Lee, who said, “Not allowing the purchase of crypto is something that’s frustrating to many advisors, but it’s such a volatile asset that many investors end up doing it on their own.”
Why It Matters: As things currently stand, the U.S Securities and Exchange Commission does not recognize cryptocurrencies as a traditional asset class, like stocks or bonds, and disclosure requirements for mutual funds that own cryptocurrencies remain unclear.
In light of this regulatory uncertainty, investment managers continue to be apprehensive about buying Bitcoin (CRYPTO: BTC), Ethereum (CRYPTO: ETH), and other altcoins.
Bitcoin and Ethereum have each returned over 900% since March 2020 despite being the two largest cryptocurrencies by market cap, making them an attractive investment class for wealth managers.
What Else: While regulatory clarity in the U.S is yet to take shape, one of the largest cryptocurrency exchanges in China was just granted regulatory clearance to establish a crypto asset management fund.
In an official announcement earlier today, Huobi said that it had been granted a license from the Hong Kong Securities and Futures Commission to launch a cryptocurrency asset management portfolio.
Image: lo lo via Unsplash
© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.