Constancy Director of World Macro Jurrien Timmer as we speak highlighted that Bitcoin reclaiming the $100,000 stage this week coincides with a convergence of its 52-week Sharpe ratio with gold.
Timmer mentioned,
After a robust run by gold, maybe the baton is being handed once more to Bitcoin, with Bitcoin again above $100k and the 2 Sharpe Ratios now converging… At a 4:1 ratio, gold’s volatility has been roughly equal to Bitcoin, as has its relative efficiency.
— Jurrien Timmer, X put up, 16 Could 2025
Key numbers
- Bitcoin worth: ≈ $103,600 (16 Could 2025)
- Gold worth: ≈ $3,213 / oz (16 Could 2025)
- 52-week Sharpe ratio: Gold 1.33 | Bitcoin -0.40
- Timmer allocation heuristic: 4 elements gold, 1 half Bitcoin
Gold has produced 67 report closes since early 2024 and stays about 33 % greater year-to-date. Bitcoin, in the meantime, is up roughly 25 % from its April low of almost $76,000. The ensuing Sharpe convergence suggests Bitcoin’s risk-adjusted efficiency is approaching that of bullion.
Why the 4:1 combine issues
By scaling gold publicity to 4 instances that of Bitcoin, Timmer finds that historic volatility and cumulative returns align intently.
The rule of thumb frames the 2 belongings as complementary shops of worth fairly than rivals, providing allocators a template to steadiness inflation hedging with upside participation within the digital-asset market.
- Portfolio building: A blended sleeve might mood Bitcoin’s drawdowns with out sacrificing long-term real-return potential.
- Rotation watch: A softening gold development and bettering Bitcoin Sharpe may immediate tactical rebalancing towards crypto.
- Dangers: Bitcoin’s Sharpe stays damaging; regulatory actions or liquidity shocks may widen the hole once more.
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