The 2008 and 2009 global financial crisis left many investors disappointed with the high volatility and negative performance of their portfolios and leading them to re-evaluate the risk reducing ability of asset allocation.

They were surprised to find that many of the historically non-correlated asset classes had become highly correlated during the crisis, rendering asset allocation less effective at diversifying returns and lowering risk. As such, it is no coincidence that many investors are now implementing hedging strategies (such as short futures contracts), in conjunction with their asset allocation strategy, in an effort to better manage portfolio volatility, avoid large losses during substantial market declines, and create a smoother overall investment experience.

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