The allure of hedge funds is that they promise to earn good returns, whether the market is rising or falling. Reserved for the wealthiest investors, these exotic funds vary in their investment styles and returns, but they all share a tendency toward illiquidity, opacity, hefty fees and high investment minimums.

Those barriers keep ordinary investors from investing in hedge funds. But the introduction of low-cost clone hedge funds, constructed from exchange-traded funds (ETFs) by using quantitative investing techniques, may let Main Street enjoy hedge fund-like results.

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