Important points
AMP has allocated $27 million to Bitcoin, becoming Australia's first super fund investment in a digital asset. Bitcoin investment is part of AMP's diversification strategy to increase returns and manage risk.
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AMP has become Australia's first pension fund to invest in Bitcoin. The company confirmed on Thursday that it had allocated about $27 million, or 0.05% of its $57 billion in assets under management, to crypto assets and purchased them at prices between $60,000 and $70,000.
Word started spreading after Steve Flegg posted it on LinkedIn. AMP's senior portfolio manager said the company “took a leap of faith” as Bitcoin concludes a “wild year.”
Stuart Elliott, Head of Portfolio Management at AMP, said in a recent interview with Super Review that wealth and pensions managers have adopted dynamic asset allocation programs after thorough testing and consideration by their investment teams. He said he chose to add “small, risk-managed positions.” .
Elliott said investing in Bitcoin is part of a broader diversification strategy to increase returns and manage risk. AMP recognizes the growing trend of institutional investors entering the crypto market, as evidenced by the launch of a number of crypto ETFs last year.
University of New South Wales economist Richard Holden said AMP's investment was a milestone for publicly traded super funds, with self-managed super funds already holding between $2 billion and $3 billion in crypto assets. He pointed out that there was.
Caroline Bowler, CEO of Australia-based cryptocurrency exchange BTC Markets, supported the move, saying:
“The crypto market is experiencing significant growth that cannot be ignored. It’s not just about buzz, it’s about the real potential Bitcoin has as part of a diversified investment strategy.”
Industry-wide skepticism
A number of other large funds, including AustralianSuper, Australian Retirement Trust and MLC, have expressed skepticism about investing directly in cryptocurrencies.
Australia's largest pension fund, AustralianSuper, said it would not follow AMP's lead but was considering blockchain investments.
The Australian Retirement Trust, which manages A$230 billion in assets, said it has no plans to invest in cryptocurrencies or Bitcoin in the near future.
Like AustralianSuper and Australian Retirement Trust, MLC does not currently invest in cryptocurrencies, but may do so in the future. MLC Chief Investment Officer Dan Farmer said it's a case of “not yet, not yet” when it comes to crypto investing.
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