Many investments inspired by new technology can be treacherous territory, but also, under the right conditions, they can offer enormous upside. Depending on the timing, the same investment can be both disastrous and generate great returns. Since the rise of Bitcoin and cryptocurrencies, some investors have experienced the highs and lows of rapid-cycling volatility.
In this episode, Mark speaks with Randy Frederick, Managing Director of Trading and Derivatives for the Schwab Center for Financial Research. They discuss the history of Bitcoin, some of the risks associated with cryptocurrency, tax implications, and some of the difficulties of trading a new currency.
Financial Decoder is an original podcast from Charles Schwab. For more on the series, visit Schwab.com/FinancialDecoder.
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Important Disclosures:
The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision.
All expressions of opinion are subject to change without notice in reaction to shifting market or economic conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed.
Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance.
Investing involves risk, including risk of loss.
Digital currencies, such as Bitcoin, are highly volatile and not backed by any central bank or government. Digital currencies lack many of the regulations and consumer protections that legal-tender currencies and regulated securities have. Due to the high level of risk, investors should view Bitcoin as a purely speculative instrument.
Currencies are speculative, very volatile, and not suitable for all investors.
Futures trading involves a high level of risk and is not suitable for all investors.
This information does not constitute and is not intended to be a substitute for specific individualized tax, legal, or investment planning advice. Where specific advice is necessary or appropriate, Schwab recommends consultation with a qualified tax advisor, CPA, financial planner, or investment manager.
The policy analysis provided by the Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party.
All corporate names are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security.
Diversification strategies do not ensure a profit and do not protect against losses in declining markets.
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