Jurrien Timmer, Director of Global Macro at Fidelity, noted that Bitcoin reclaiming the $100,000 level coincides with the convergence of its 52-week Sharpe ratio with gold, suggesting that the risk-adjusted performance of both assets is becoming more aligned.

Currently, gold has a Sharpe ratio of 1.33, while Bitcoin stands at -0.40. According to Timmer’s 4:1 allocation model (four parts gold to one part Bitcoin), the volatility and cumulative returns of the two assets become comparable, allowing investors to use gold as a buffer against Bitcoin’s volatility while still capturing its long-term upside.

As of May 16:

Bitcoin: ~$103,600

Gold: ~$3,213/oz

Gold is up ~33% year-to-date; Bitcoin has rebounded ~25% from its April low of $76,000

If the trend continues, Fidelity suggests a strategic rebalancing may occur in favor of increased crypto exposure.