Bitcoin won, gold lost and you didn’t even see it – 10/22/2023 – Marcos de Vasconcellos

Gone are the days when everyone talked about bitcoin, cryptocurrencies and NFTs with images of little monkeys. Searches for the term bitcoin on Google today are just 38% of what they were there in September 2019, according to the platform itself. Curiosity about “NFTs” has fallen even further and is now at 4% of the peak of searches, reached in January last year.

The eyes don’t see, but, interestingly, the pocket feels. The multimarket funds that gave the most returns in the first nine months of this year were precisely those that invest in cryptocurrencies. Those that left their shareholders feeling worse are also, for the most part, concentrated in a few types of assets, such as gold, silver and cannabis.

The list of the 60 funds that delivered the best and worst returns this year can be accessed on the Market Monitor website (available here) and was prepared at the site’s request by market data specialist Einar Rivero, based on information from the tool More Return. As a selection, funds accessible to all types of investors, non-exclusive and with at least one thousand shareholders, were filtered.

In the top 3, there are two funds from the Hashdex manager and one from XP, focused on cryptocurrencies in general and specifically on bitcoin. They returned 51% and 42% from January to September, while the Ibovespa rose 9.5%.

It was a great shot, as they are not actively managed funds (that is, they only buy assets), the glory lies in the timing of purchasing their shares. Those who simply bought bitcoin at the turn of the year reached October with 54% gains. But if it did so in January 2022, it would still suffer losses of 44%.

Among the 30 funds that caused the most losses for their shareholders until the arrival of this month, it is notable that five concentrate their investments in gold. Again, these are not actively managed funds – and the price of the coveted metal plummeted in September.

It is worth mentioning, in fact, that in the last ten days, since the intensification of the war between Israel and Palestine, increasing the feeling of insecurity in the global market, the price of gold has risen by more than 8%.

The lesson that remains, when moving away from specific cases and looking at the ranking as a whole, is how the funds that take their investors to heaven or the edge of hell, for the most part, are focused on a few types of assets. Without diversification, risks increase and, as we must always remember, more risks increase the chance of poor returns, as well as painful falls.

Choosing a fund (or asset in general) looking only at its profitability over the last 9, 12 or 24 months is as useless and risky as driving a car looking only in the rear view mirror. Anyone who had taken the last year into account would never have profited from bitcoin funds this year.

PS: For those curious like me, the winning fund was Hashdex Bitcoin FIC FIM, from the Hashdex management company. Its objective is to reach an exposure close to 100% in bitcoin, simply facilitating access for investors more accustomed to placing money in funds than operating digital cryptocurrency wallets.

The fund that caused the most losses for its shareholders from January to September this year was the so-called Esh Theta 18, whose share value fell by more than 50%. Its manager is known for public fights on social media, with serious accusations against controllers of the companies in which he invests.

The objective is to “seek appreciation through the improvement of corporate governance and the civil and administrative liability of those who act in a way that harms invested companies”, says manager Esh Capital.

In free translation: its focus is to buy shares in companies that it believes are poorly managed and demand changes in them, hoping for appreciation and possible compensation to investors. Its main positions, according to a document published in September, are Terra Santa (LAND3) and the construction company Gafisa (GFSA3).

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