Exclusive: Kevin O'Leary Talks Crypto, Psychedelics And The Importance Of Investment Diversification

Investor and "Shark Tank" star Kevin O'Leary recently sat down with Benzinga to discuss a range of subjects, including his recent pivot to psychedelics, his new investment in crypto, as well as his desire to help Americans save for retirement.

O'Leary, often dubbed "Mr. Wonderful", cited regulatory shifts and other prosperous signs as a reason for his interest in the two niche markets.

See also: Best Cryptocurrency Apps

That sentiment, however, doesn't extend to cannabis. See video below:

Significant Pivot On Crypto: O'Leary recently put 3% of his portfolio in bitcoin after opposing the e-currency for several years.

He says the shift was brought on, in part, by evolving regulatory stances in Canada, Switzerland and other nations.

"I am very compliant, and I make sure all the companies that I invest in are," he said. 

After initially adding crypto to his holdings in 2017, the 3% investment now places him in the space in a more significant fashion. 

Warm On Psychedelics, Not On Cannabis: Shifting regulations also got O'Leary into the psychedelics space, including his 2019 investment in Mind Medicine (MindMed) Inc. MMEDF, as part of its $6.2 million investment raise.

The investor balked at psychedelics for some time due to its federal legal status. The sentiment mirrors his current stance on cannabis and its RICO statute concerns.

"I can't be involved in a commodity that if it crosses state lines, breaches the RICO statute, and I'm a shareholder of the company," said O'Leary. "That's just not going to happen."

While cannabis remains excluded from his portfolio, O'Leary's opinion on psychedelics shifted after speaking with MindMed CEO and Co-Founder JR Rahn.

Calling Rahn "a really interesting guy," O'Leary thought the CEO was initially out of his mind trying to convince the Shark Tank star to invest in psychedelics research.

Rahn would change O'Leary's mind by laying out a roadmap to FDA-approved clinical trials and the potential in addressing the mental health and opioid issues.

After due diligence confirmed the endeavor's validity and receiving assurance that the company wouldn't go into the recreational space, O'Leary made his move.

The investor suggests that would-be investors find options involved in multiple trials and molecules to diversify the risk associated.

The strategy has paid off so far for O'Leary, noting psychedelics as the top performer in his portfolio last year.

Conservative Market Approach To Long-Term Gains: O'Leary credits his mother, a hardworking Lebanese immigrant factory worker who saved portions of each paycheck from the 1950s until her passing, for shaping his investment strategy.

Investing in the S&P and Telco bonds, he remembered his mother saying: "People would turn off their heat before they turn off their phone."

Her passing would reveal her strategy and savings to her two sons, which motivated O'Leary's strategy to this day.

Beanstox, a venture launched in recent years, hopes to do the same for millions of Americans living without savings.

O'Leary urges people to put aside $100 with each check and invest as a way to "de-risk" their lives over the ensuing decades.

"The average salary being $55,000 in America, you really go to think there's a way," he said, suggesting day traders do the same with 10% of their earnings.

Disclosure: The author of this article owns shares in MindMed.