Cathy Wood sees Bitcoin as an effective portfolio diversifier in the coming years.
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Cathy Wood of ARK Invest sees Bitcoin as a strong portfolio diversification tool due to its low correlation with other major asset classes. An analysis of weekly returns from 2020 to 2026 shows Bitcoin's lower correlation to gold (0.14) compared to the S&P 500 bond (0.27).
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Bitcoin's low correlation to major asset classes such as gold, stocks and bonds makes it a strong tool for portfolio diversification and high return on risk, ARK Invest CEO Cathy Wood said in her 2026 outlook Thursday.
ARK's analysis from January 2020 to early January 2026 shows that bitcoin has a 0.14 correlation with gold, much lower than the 0.27 correlation between the S&P 500 and bonds.
Bitcoin's correlation is lowest with bonds (0.06), slightly higher with gold and REITs, and highest with the S&P 500 at 0.28. Even at its peak, Bitcoin's correlation is much lower than traditional asset pairs such as the S&P 500 and REITs, which correlate at 0.79.
“In the coming years, bitcoin should be a good source of diversification for asset allocations seeking high returns in every risk category,” Wood wrote.
On Bitcoin mining, Wood said Bitcoin supply growth is strictly limited by the protocol, with new output set to increase 0.8% per year over the next two years before slowing to 0.4% per year.
Unlike gold, where miners can react to higher prices, the supply of Bitcoin is fixed mathematically, making it finite in nature. This predictable supply schedule, combined with increased demand, has contributed to a 360 percent increase in prices since the end of 2022.
The CEO of ARK Invest shares her views on the US economy, monetary policy and AI.
She described a “bundled resource” set for economic recovery, with low inflation and tax policies as drivers of revenue and corporate cash flow growth, and said AI, robotics, energy storage, blockchain and multimics could boost productivity and support strong GDP growth.
