Hedge Fund Star Israel Englander Shifts Strategy: More Bitcoin, Less Nvidia
It’s no surprise that Nvidia (NASDAQ: NVDA) has become a top choice among tech investors, with a remarkable 192% gain this year and an impressive 2,547% increase over the past five years.
However, billionaire hedge fund manager Israel Englander of Millennium Management has recently cut back on his Nvidia holdings. This move raises questions about whether he anticipates that Bitcoin (CRYPTO: BTC) might outperform Nvidia in the future. Let’s explore his recent investment decisions.
Englander Expands Bitcoin Investments
Recent 13F filings reveal that Englander sold 1.6 million shares of Nvidia, leading to a 12.5% reduction in his holdings. In contrast, he increased his Bitcoin investment by about 120%.
Englander acquired 12.62 million shares in the iShares Bitcoin Trust (NASDAQ: IBIT), which has become a leading option for investors interested in Bitcoin ETFs. He has also slightly increased his stake in the Fidelity Wise Origin Bitcoin Fund (NYSEMKT: FBTC), another popular Bitcoin ETF.
Image source: Getty Images.
According to the filings, Nvidia represents 1.17% of Englander’s overall portfolio, while Bitcoin now makes up roughly 1.3%. Although these percentages may seem small, both Nvidia and Bitcoin rank among the top 10 holdings of Millennium Management, which oversees over $115 billion in assets. This means any adjustments to these positions may indicate significant market trends.
It’s essential to note that 13F filings reflect a specific time frame—in this case, September 30. With much happening since then, including a presidential election, Englander’s increased interest in Bitcoin suggests he sees potential growth in the asset.
Potential for Bitcoin Surpassing Nvidia
Englander’s decision to reduce Nvidia shares while acquiring more Bitcoin indicates he believes Bitcoin may outperform Nvidia. However, as of 2024, Bitcoin has risen 125% compared to Nvidia’s 192% gain.
In November, following Donald Trump’s election, Bitcoin experienced a remarkable rally, soaring 40% within weeks. Trump’s efforts to position himself as a pro-crypto candidate may have contributed to this surge.
If Trump carries through with initiatives like establishing a strategic Bitcoin reserve, Bitcoin could experience exponential growth in 2025. This plan might involve the U.S. government purchasing 1 million Bitcoins over five years, positioning it as the largest Bitcoin holder globally. Such sustained demand could significantly elevate Bitcoin’s price.
How much can Bitcoin actually rise? Some experts speculate it could double to $200,000 next year, while others, like Cathie Wood of Ark Invest, predict potential highs of $1 million by 2030. Michael Saylor, founder of MicroStrategy, even suggests Bitcoin could hit $13 million within the next two decades.
Assessing Your Investment in Bitcoin
With such lofty predictions, investors might feel compelled to invest heavily in Bitcoin. However, Englander’s strategy serves as a cautionary example. Bitcoin currently comprises just over 1% of his total portfolio, even after increasing his stake by 120%. In fact, the iShares Bitcoin Trust is only the eighth largest position in his portfolio, and the Fidelity Wise Origin Bitcoin Fund ranks tenth.
Therefore, when considering Bitcoin investments, it’s crucial to prioritize portfolio diversification. Generally, Bitcoin should not account for more than 5% of an investment portfolio. Following Englander’s lead suggests that it should be closer to 1%, depending on individual risk tolerance and comfort with Bitcoin’s historical volatility.
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Dominic Basulto has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin and Nvidia. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
