Fortress says no to crypto

Barbados based mutual fund company Fortress, which for the first time in its near 30 year history has more than $1 billion in total assets under management, has no plans to add crypto currencies to its portfolio.

The same goes for investments in precious metals, including gold and silver, said Fortress Fund Managers’ chief executive officer and chief investment officer (CIO) Peter Arender.

Fortress now allocates investor funds to a diverse range of equities and bonds in a variety of markets and Arender said this strategy would continue.

He addressed the issue of crypto currency investments recently when the company held its 14th Annual Investment Forum at the Frank Collymore Hall.

Asked if Fortress had an investment presence in the crypto markets, Arender said not directly, underscoring that this position was not likely to change. For the company, the inability to assign a reliable value to these digital assets was a major red flag.

“I suppose since crypto uses up more of things that involve electricity, involves processors and so on, . . . we own companies that would be involved in satisfying some of that demand. But direct investments in cryptocurrencies – no,” the investment expert said.

“And the . . . reason we have, is because our discipline that we want all of our clients to know they can rely on is our job, is to find assets that have underlying economic engines of generating earnings, or in the case of bonds, income, that we can ascertain the probable value of and purchase at something that we consider to be at or near that probable value, ideally lower.

“And when it comes to cryptocurrencies, it’s no disrespect on the people who do see value in it, but . . .we’re not able to understand what value or what wealth is being created within the engine there, nor what the correct value is for them. So until we can do that, we’re not going to risk other people’s money on them.”

Arender was asked if there was a price at which Fortress would become interested in crypto currency investment.

“No. It would still need to be back to if we could hang our hat on some underlying wealth creation and understand what the correct value is, but as long as it’s above zero, it’s hard for us to know that the price is correct,” he stressed.

Arender was also asked if the same position applied to gold and some of the other precious metals which have been performing well on the market.

Actual profits

The Fortress CEO responded: “When cryptocurrencies’ [prices] were going up, we quite honestly wouldn’t have gotten any very kind applause for not having owned it and similarly, when gold’s gone up a lot, and silver has gone up more, and possibly next year, oil goes up a lot, and the question will be, why don’t we own oil?

“What we want to own is shares of companies that earn money, actual profits, doing actual things that everybody can understand, and who’s expected to grow and understand how to allocate capital and how to manage their business properly, and whose shares we can buy at reasonable prices.”

He added: “Gold’s a little closer, though. We wouldn’t buy bullion directly, we haven’t, but we always have in our net of companies that we’re analysing, companies whose operations are to take gold out of the ground and sell it.

Arender was also asked if the same position applied to gold and some of the other precious metals which have been performing well on the market.

The Fortress CEO responded: “When cryptocurrencies’ [prices] were going up, we quite honestly wouldn’t have gotten any very kind applause for not having owned it and similarly, when gold’s gone up a lot, and silver has gone up more, and possibly next year, oil goes up a lot, and the question will be, why don’t we own oil?

“What we want to own is shares of companies that earn money, actual profits, doing actual things that everybody can understand, and who’s expected to grow and understand how to allocate capital and how to manage their business properly, and whose shares we can buy at reasonable prices.”

He added: “Gold’s a little closer, though. We wouldn’t buy bullion directly, we haven’t, but we always have in our net of companies that we’re analysing, companies whose operations are to take gold out of the ground and sell it.

“So gold miners and silver miners. Typically, though they and mining companies generally, we have a little bit of exposure to that in a couple of holdings in our emerging markets fund, but mostly those companies are not long term wealth creators, so they have trouble meeting our criteria.”

Arender reported that 2025 was a good year for Fortress.

“Our assets under management have continued to grow in the last year. They were higher both because of investment performance as well as new client investment across the Caribbean Growth Fund, High Interest Fund, our pension funds, which are about half of our business, and our US dollar Global and World Funds,” he noted.

“Some of our funds invest in other funds, but I’d like to report that this year, as of December, for the first time, our total assets under management exceeded $1 billion for the first time.”

He said Fortress continued to look for “high quality, profitable companies that we can own at attractive prices” and that the company would continue to invest despite the “noise” caused increased tariffs and other events.

“There’s going to be noise and . . . when, when Liberation Day [tariffs] happened and markets went nuts and fell, we’re spending some cash to buy investments. So you can assume whenever you hear on the news that things are collapsing, we’re probably looking around for cash to spend, to buy the things that we find interesting at that point,” he said. (SC)

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