Charles Schwab examines crypto investing approaches, says even small exposure can raise risk

Charles Schwab has released research outlining two primary methods for incorporating cryptocurrencies into investment portfolios: a return-based approach and a risk-based approach. The return-based method relies on expected returns and volatility, while the risk-based strategy focuses on limiting the total portfolio risk contribution from digital assets. Jim Ferraioli, director of digital currencies research at Schwab, emphasizes that investors must remain aware that crypto assets introduce higher concentration risks compared to traditional investments. As the firm prepares to launch direct bitcoin and ether trading, this research provides a framework for clients to navigate the high volatility associated with these assets.

(Source：The Block)