The real risk isn’t bitcoin volatility, it’s underexposure

Despite being the best-performing asset of the past decade, bitcoin remains structurally under-allocated in multi-asset portfolios. Emotions may play a role in shaping investor decision-making. The result is persistent underexposure to an asset characterised by convex returns and low correlation with traditional assets. Across cycles, the same behavioural pattern repeats: • Risk is overstated • Portfolio contribution is understated • Timing is prioritised over exposure The outcome is predictable: missed participation in a highly right-skewed return distribution. This is not...