Diversification within a Cryptocurrency Portfolio
Cryptocurrency is a relatively new “trendy” allocation among not only retail investors but also institutional investors including hedge funds and investment banks. Considering the significant regulatory and behavioral adoption risk involved, when deciding to make such an allocation it is critical to incorporate diversification into a cryptocurrency portfolio. Diversification is a critical part of any portfolio, but particularly in one that is focused on a market with increased risk. A notable obstacle to diversifying a crypto portfolio stems from the fact that the crypto market often generally trends in a given direction as a whole, often making it difficult to diversify risk and shield from volatility within a crypto portfolio.
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- Anthony Winkels is Managing Partner and Wealth Advisor at Fortis Wealth Management
