Cathie Wood sees Bitcoin as an effective portfolio diversifier in the coming years

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Bitcoin’s low correlation with major asset classes such as gold, stocks and bonds positions it as a powerful tool for portfolio diversification and higher returns per unit of risk, says Cathie Wood, CEO of ARK Invest, in her report. Outlook for 2026 released on Thursday.

ARK’s analysis of weekly returns from January 2020 through early January 2026 shows that Bitcoin has a modest 0.14 correlation with gold, much lower than the 0.27 correlation between the S&P 500 and bonds.

Bitcoin’s correlation is lowest among bonds (0.06), slightly higher among gold and REITs, and highest among the S&P 500 at 0.28. Even at its peak, Bitcoin’s correlation remains well below that of traditional asset pairs, such as the S&P 500 and REITs, which correlate at 0.79.

“Bitcoin should be a good source of diversification for asset allocators looking for higher returns per unit of risk in the coming years,” Wood wrote.

As for Bitcoin mining, Wood said Bitcoin supply growth is strictly limited by protocols, with new issuance expected to increase at about 0.8% per year for the next two years before slowing to around 0.4% per year.

Unlike gold, which miners can produce more in response to higher prices, Bitcoin’s supply is mathematically fixed, making it inherently scarce. She noted that this predictable supply schedule, combined with increasing demand, has contributed to a 360% increase in prices since the end of 2022.

The ARK Invest CEO also outlined her outlook for the US economy, monetary policy and AI.

Describing the economy as a “coil spring” poised for a recovery, she highlighted lower inflation and lower tax policies as potential drivers of corporate revenue and cash flow growth, and said AI, robotics, energy storage, blockchain and multiomics can boost productivity and support strong GDP growth.