Gold, Crypto or Cash? The Investor Crisis of 2026
Stocks are usually the best investment, but allocating some of your money to other investments can open up new opportunities and act as a hedge in case the stock market goes down.
Gold and crypto are two popular alternative currencies, and cash is another option for investors who want to take risk off the table. Here’s what you need to know about each asset to build a portfolio that aligns with your goals, time horizon and risk tolerance — and sleep better at night.
The amount of diversity
Other assets can provide diversification to your portfolio, which is the key to a strong portfolio. Diversification involves having a mix of assets such as stocks, bonds, cash and other instruments, as well as having diversity within those asset classes. For example, your stock investments should include stocks of large and small, domestic and international companies and companies in many different sectors.
Diversifying your portfolio can help minimize your losses during stock market corrections, as all your assets will not behave in the same way.
Pet Protection: See Lemonade’s pet insurance options – save and protect your cat or dog from high pet bills
Assets to consider
If you have cash to spend and don’t want to allocate it to stocks and bonds, here are some options.
Money
With cash, you don’t have to worry about your money losing a small amount of value due to market corrections and commodity price fluctuations. Financial advisors generally recommend that you keep enough cash to cover your expenses for three to six months in case the unexpected happens.
However, cash is not without risk. Two problems with going all cash are opportunity cost and inflation. Opportunity cost shows how much money you could make if you invested the same amount in an asset such as an index fund that generated a 10% annual return. Inflation refers to the continuous increase in prices that reduces your purchasing power.
Free Stock Opportunity: Get up to $1,000 in stocks with a new, funded SoFi Invest account
Gold
Gold price movements are generally unrelated to the stock market. In fact, gold can rally because of the same factors that can lead to a decline in the stock market. For example, economic uncertainty and high inflation can attract investors to gold, increasing its value.
You can choose between physical gold and exchange-traded funds (ETFs) that track the price of gold. Another option is to invest in gold mining companies that rely heavily on gold prices to deliver profits and income growth.
But remember that gold prices can fluctuate, and you take a risk when investing in the precious metal. It also does not generate cash flow and may trail the stock during long rallies. That’s why experts recommend a small allocation to gold, usually no more than 5-10% of your portfolio.
Save Smartly: Manage your money with the Rocket Money budgeting app
Crypto
Cryptocurrencies such as bitcoin and ether have received a lot of attention in recent years due to their volatility which can lead to prices rising one day and falling the next. Because of its volatility, crypto can offer significant benefits, but it is also a risky asset. Advisors often recommend keeping your crypto investments to 5% of your overall portfolio, with many calling for an even smaller share.
