From Yahoo Finance: 2025-06-01 08:00:00

Financial advisors are taking a second look at Bitcoin as the cryptocurrency hits record highs and gains 42% in the past two months. Bitcoin’s price volatility remains a concern, with gains of nearly 17% this year and a peak-to-trough decline of over 40%. Advisors suggest a conservative allocation for clients interested in exposure.

The popularity of Bitcoin investing has grown rapidly since the debut of spot Bitcoin ETFs in January 2024. The SEC has approved spot Ethereum ETFs, and funds are incorporating options strategies to leverage and hedge crypto investing volatility. The $70 billion iShares Bitcoin Trust has received over $8 billion in net inflows this year.

The appeal of crypto investing is attributed to the Trump administration and a second wave of crypto ETFs targeting various investor categories. ETFs like the Calamos Bitcoin Structured Alternative Protection ETF and the NEOS Bitcoin High Income ETF offer different strategies to manage price volatility and generate income through exposure to Bitcoin.

Advisors are adding Bitcoin ETFs to client portfolios, but some clients remain cautious due to the asset class’s volatility. Advisors emphasize diversification and limit exposure to 1-3% of the portfolio due to the speculative nature of digital assets. Bitcoin’s behavior as an inflation hedge or portfolio diversifier is being closely monitored as correlations with equities increase during market stress.



Read more at Yahoo Finance: Bitcoin’s Record Rally Prompts Advisors to Take a Second Look