Gate News message: On April 7, U.S. financial giant Charles Schwab released a research alert stating that even if only 1%-3% of funds are allocated to Bitcoin or Ethereum in an investment portfolio, it may significantly change the portfolio’s overall risk profile. The report notes that both Bitcoin and Ethereum have historically experienced drawdowns of more than 70%, far higher than the volatility levels of stocks or bonds; therefore, even small allocations can have a noticeable impact during periods of market volatility. Charles Schwab proposed two approaches to allocating crypto assets: first, the traditional portfolio theory method, which allocates based on expected returns, volatility, and correlation; second, a risk-first approach, which determines the share of crypto assets based on the amount of risk one is willing to take, shifting the focus from returns to risk tolerance.
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