Jefferies' Chris Wood cuts exposure in gold for bitcoin

Bitcoin's blistering rally has seen Christopher Wood, global head of equity strategy at Jefferies, trim exposure in gold in favour of the cryptocurrency in his long-only global portfolio for US dollar-denominated pension funds "for the first time in several years".

Wood has said the fund, established in the third quarter of the calendar year 2002, will reduce its exposure in physical gold by 5 percent and the money will be invested in bitcoin. The fund intends to increase its long position on any correction.

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"The 50 percent weight in physical gold bullion in the portfolio will be reduced for the first time in several years by five percentage points with the money invested in Bitcoin," Wood said in his weekly note, GREED & fear, to investors.

If there is a big drawdown in bitcoin from the current level, after the historic breakout above the $20,000 level, the intention will be to add to this position.

In a year of many firsts, Bitcoin prices have surged 220 percent year-to-date, outshining all other asset classes. On December 17, it breached the $23,000-mark, a day after hitting the $20,000 milestone for the first time since its launch in 2009.