Gold, bitcoin fail to shield investors from Thursday’s stock market meltdown

  • Despite Thursday’s stock market plunge, traditional and non-traditional hedges as yellow and bitcoin weren’t immune from the sell-off.
  • Technological innovation stocks led a steep sell-off of the market, with the Nasdaq hundred index down almost as 5.5 % in Thursday afternoon trades.
  • Gold traded down pretty much as 1 %, while bitcoin fell 6 % on Thursday.
  • Typically, investors appear to these non-traditional assets to provide shelter during stock market sell-offs.


Technology stocks led the marketplace decline, with the Nasdaq hundred index down almost as 6 %. Mega-cap tech winners like Apple, Amazon, and Microsoft fell 8 %, seven %, along with 6 % respectively.

Meanwhile, the S&P 500 fell almost as 4 %, while the Dow Jones industrial average fell over 1,000 steps for a loss of three %.

The high technology-driven sell-off in the stock market spread to non-traditional and traditional collection hedges like bitcoin and orange.

Gold fell almost as one % to $US1,927.20 per ounce in Thursday trades, while bitcoin fell almost as six % to $US10,455.

Each of those gold and bitcoin have just recently been bid set up by investors concerned about the growing balance sheet of the US Fed and its the latest policy overhaul which will probably result in greater levels of inflation.

Last month, gold touched all time highs during $US2,089 an ounce, while bitcoin reach a multi-year high of $US12,473.

Investors generally look to both gold and bitcoin as a hedge to inflation, deflation, and decreasing stock prices due to their historically low correlation to equities.

But that historical correlation didn’t play out on Thursday.

One particular classic asset class which did offer protection to investors from Thursday’s market sell-off was bonds. The Bloomberg Barclay’s US Aggregate Bond Index traded up almost as 0.20 %.

For all the dialogue among Wall Street analysts that the popular 60 40 investment portfolio that balances stocks and bonds is actually “dead,” it is alive and very well today.