Diversification has long been a cornerstone of investing, designed to balance risk across different markets and asset classes. But with fiat currencies under persistent inflationary pressure, government debts climbing to unsustainable levels, and geopolitical tensions disrupting financial flows, diversification increasingly means understanding how shifts in monetary regimes can ripple through markets. After retiring following a four-decade career, Ari Aaltonen has returned to co-launch a new asset management firm and a macro, multi-asset hedge fund built specifically to protect investors against what he sees as an approaching “monetary reset.”
“My outlook for a monetary reset implies major shifts in the global monetary system,” says Ari Aaltonen, Chief Investment Officer at Signum Asset Management. “We are facing excessive debt levels and challenges that cannot be resolved through conventional fiscal or monetary policy,” explains Aaltonen, who spent the first third of his career as an economist at the Bank of Finland and later as chief economist at two commercial banks. “It is only a question of which type of crisis will hit Western countries next.”
“My outlook for a monetary reset implies major shifts in the global monetary system. It is only a question of which type of crisis will hit Western countries next.”
In addition to fiat currencies losing value under the weight of monetary and fiscal stimulus, Aaltonen highlights the ongoing “battle for the reserve currency,” which adds yet another layer of pressure on the existing monetary system. “At the moment, gold seems to be winning that race,” he notes. Yet Bitcoin and the broader ecosystem of blockchain technologies are emerging as strong contenders as well, according to Aaltonen.
A Fund Built for Monetary Shifts: The Four Pillars
One of the two funds managed by Aaltonen, Signum Monetary Systems & Inflation Hedge AIF, is specifically designed to benefit from structural shifts in global monetary systems and to protect against inflation and the vulnerabilities of fiat currencies. The fund targets themes such as rising geopolitical tensions, unsustainable government debt, and the long-term erosion of monetary stability. To capture these dynamics, the multi-asset strategy invests selectively across equities, fixed income, commodities, and Bitcoin- or blockchain-related companies.
Pillar One: Inflation-Linked Bonds
One of the fund’s four broad exposures is fixed income, which primarily consists of inflation-linked government bonds from major developed economies. Aaltonen prefers to avoid long-term bonds and has little appetite for credit risk. “The instruments that work best, especially in the context of inflation, are government bonds linked to inflation, like TIPS in the U.S. and similar instruments in Europe.” He notes, however, that the principal is still exposed to interest rate risk.
To address this, roughly two-thirds to three-quarters of the fixed-income allocation is protected against rising rates, hedged through short positions in equivalent government bonds. “This structure provides almost permanent protection against interest rate increases and performs well when inflation and inflation expectations are on the rise,” Aaltonen adds.
Pillar Two: Gold
Another part of the portfolio is allocated to commodities, primarily precious metals, which serve as a store of real value. Aaltonen anticipates “a major monetary cold war” unfolding globally, with early signs appearing after Russia’s initial invasion of Ukraine in 2014. “When Western countries began imposing sanctions, there are enough nations in positions where holding U.S. or European government bonds carries the risk of being sanctioned,” Aaltonen explains.
As a result, these countries are looking for a way to preserve their foreign currency reserves. “All the talk about BRICs, alternative currencies, or similar solutions is nonsense,” Aaltonen asserts. “The only real solution for these countries and their central banks is gold.” He sees gold as “a hedge against the ongoing monetary cold war. It serves as protection for central banks and governments outside the Western world.”
“[Gold is] a hedge against the ongoing monetary cold war. It serves as protection for central banks and governments outside the Western world.”
Gold represents a key exposure in the fund’s portfolio, accounting for roughly one-third of its assets, while fixed income makes up about 40 to 45 percent. “I don’t maintain a fixed allocation,” notes Aaltonen. “But as a rule of thumb, I generally aim for gold to constitute about one-third of the portfolio.”
The Last Two Pillars: Equites with Moderate Risk and Blockchain Exposure
The fund’s final two pillars comprise moderate-risk equities and digital assets linked to Bitcoin and the broader blockchain ecosystem. The equities segment focuses on companies and sectors that tend to perform well during periods of stress, whether geopolitical or monetary. “We include infrastructure companies, which typically hold up during market downturns, as well as insurance firms. Defense is another key component, and we also have exposure to nuclear power,” says Aaltonen.
The blockchain exposure represents “a hedge against the monetary reset, if fiat currencies run into serious trouble, people will need alternatives to preserve their wealth,” according to Aaltonen. “At the moment, fiat currencies essentially force people to become investors. They have to put their money into real estate, equities, or other assets just to maintain the purchasing power of their capital,” he continues. “Money sitting in the bank simply doesn’t preserve value, inflation always wins.”
“The only real winner in that space is Bitcoin. We don’t believe other coins have a meaningful future as money.”
Aaltonen sees two components within the blockchain allocation: Bitcoin and companies exposed to blockchain technologies. “The only real winner in that space is Bitcoin. We don’t believe other coins have a meaningful future as money. They may have value as technologies, but they are not contenders for the monetary role,” he argues. Bitcoin could play a significant role as a medium of exchange in developing countries, according to Aaltonen, allowing people to make payments and bypass the traditional banking system. “Overall, we view Bitcoin more as digital gold, a hedge against the inflation of fiat currencies.”
However, Bitcoin is not the only exposure within this pillar. “It’s not just Bitcoin or Bitcoin miners. We also invest in traditional financial institutions that are starting to engage with blockchain technology,” notes Aaltonen. “This can include companies like BlackRock, Visa, and MasterCard, any firm with a clear vision to participate in this space.”
Performance and Outlook
By design, Signum Monetary Systems & Inflation Hedge AIF is structured to perform best in an environment of rising inflation and growing inflation expectations. Yet the strategy has delivered strong results so far in 2025, despite a backdrop of cooling inflation. The fund gained 11.1 percent in the first 11 months of the year, bringing its inception-to-date return to 16 percent since launching in late 2024. Given its significant allocation to gold, it is perhaps unsurprising that precious metals have been the largest contributor to performance. “Precious metals have been the key driver this year, mainly because they represent about a third of the portfolio,” Aaltonen notes.
“Everything seems to be melting down at the moment, perhaps even a minor financial crisis is on the horizon.”
Looking ahead, Aaltonen finds the prospects for the next years particularly interesting. “We expect the business cycle to deteriorate significantly,” he says. “Everything seems to be melting down at the moment, perhaps even a minor financial crisis is on the horizon.” He highlights a range of risks, including the upcoming U.S. elections, a new Federal Reserve chair, and potential major shifts in Fed policy.
