As Bitcoin becomes more widely available to Canadian investors through a variety of new funds, retail investors are far more bullish on the cryptocurrency than advisors, according to a survey from Horizons ETFs Management (Canada) Inc.
Advisors are “overwhelmingly pessimistic” on Bitcoin, according to the fund company’s Q2 survey of advisor and investor sentiment, reporting a 45% bearishness. That was in contrast to enthusiastic investors who were 52% bullish on the cryptocurrency.
Every quarter, Horizons ETFs polls investment advisors and investors for their outlooks on expected returns for various asset classes. Expectations are expressed in terms of bullish, bearish or neutral sentiments.
The Q2 survey marked the first time Horizons included Bitcoin in its sentiment survey, after Purpose Investments Inc., Evolve Funds Group Inc., CI Global Asset Management, Horizons and others launched cryptocurrency ETFs in recent weeks.
The survey also included the psychedelics sector for the first time, which also garnered more enthusiasm from investors than advisors. Mark Noble, executive vice-president of ETF strategy at Horizons ETFs, said adding Bitcoin and psychedelics made sense given the amount of discussion they’ve generated this year.
“It’s not all too surprising to see advisors a little more skeptical of these areas where valuations can seem very high and somewhat disconnected from the fundamentals,” he said in a release. “Whereas we have seen self-directed investors a lot more excited about these areas, investing very much on their transformational potential rather than their current drivers of growth.”
After a strong first quarter for the S&P/TSX 60, advisors were even more bullish (73%) on Canadian equities than investors were (60%). Advisors’ enthusiasm was spurred by the financial sector’s strong performance last quarter.
When it came to U.S. equities, investor sentiment toward tech stocks dropped while they became more bullish on the S&P 500. Advisors, on the other hand, were more bullish than last quarter on the Nasdaq-100 (53%) and the S&P 500 (69%). Advisors were also more bullish on international equities (65%) than investors were (58%).
After a brutal quarter for the sovereign bond market, investors were bearish on bonds, while advisors were neutral on the asset class.