Boomers' Bitcoin Loyalty Trade Misses S&P 500 Rally

Bitcoin ETF holders have shown remarkable discipline by holding onto their positions through a brutal 54% drawdown, according to Bloomberg ETF analyst Eric Balchunas. The lifetime cumulative net flows of these funds sit at $55 billion, down from a peak of $63 billion but up from a low of $50 billion.

Balchunas praised the investors for their intestinal fortitude, but noted that this loyalty came at a cost, they missed out on the best broad-market stretch in a decade. The SPDR S&P 500 ETF (SPY) rose 15.5% over the past year, while bitcoin is down 34.4% over the same period.

The macroeconomic signal that matters most for SPY's performance is the 10-year Treasury yield, which has recently touched 5%. If this level holds or breaks decisively above, it could pressure the valuations of mega-cap growth names and impact SPY's performance. Currently, a third of SPY sits in these sensitive stocks.