Amid market uncertainty, gold, silver, and Bitcoin emerge as "fortresses of asset protection" = What Goldman Sachs' portfolio strategy suggests

The Four Pillars of Portfolio Composition Suggested by Tony Pasquariello

Tony Pasquariello, Head of Global Hedge Funds at Goldman Sachs, presents an optimal asset allocation approach for the current market environment. Central to his strategic framework are a long position in U.S. technology stocks, long positions in store-of-value assets such as gold, silver, and Bitcoin (BTC), limited dollar selling, and a steepener buy of the global yield curve.

This configuration is not merely a collection of individual stocks but functions as a complex hedging strategy that includes Bitcoin, which currently trades around $95.26K. Each position may fluctuate on a weekly basis, but as an integrated approach, Tony Pasquariello points out that it serves as a “desirable defensive measure” during market turbulence.

The Importance of Balancing Technology and Defensive Assets

Looking at the current market, the S&P 500 has recovered from last week’s sell-off, and the Nasdaq has hit new all-time highs. The backdrop of this recovery includes steady inflows into AI-related stocks, healthy capital flows, and a gap between the stock market and the real economy amid concerns over slowing employment growth.

In this environment, Pasquariello’s inclusion of gold, silver, and Bitcoin in the portfolio aims to navigate the “nervous and highly volatile” trading period of summer, where market depth is expected to deteriorate. These three store-of-value assets are positioned as essential elements in a “hedged long strategy” heading into the second half of 2025.

Strategy Planning for Short-Term Volatility

With August’s range-bound market and technical risk factors anticipated in September, Pasquariello is closely monitoring the slowdown in the U.S. labor market and the positioning pressure from systematic traders. These factors could exert short-term downward pressure on the market.

However, his fundamental view remains that the upward trend in U.S. equities, especially technology stocks leading earnings growth, will continue into the second half of 2025. The inclusion of defensive assets like gold, silver, and Bitcoin is justified as a hedge cost that does not undermine this bullish outlook.

Continuity of the Integrated Approach

Individual positions are inevitably subject to weekly fluctuations. For example, last week’s dollar selling and this week’s steepener buying may underperform, which is commonplace. Nonetheless, Pasquariello emphasizes the overall effectiveness of the composite strategy. The four elements—gold, silver, Bitcoin (BTC $95.26K), U.S. technology stocks, dollar selling, and global curve steepener—work synergistically, enabling a stable asset allocation amid the current highly uncertain market environment.