What is a mutual fund to do to stand out in a crowded field of roughly 8,000? The WSJ
reports that their latest strategy involves using complex financial products called derivatives to hedge their bets or boost their returns. Companies that currently use derivatives are Eaton Vance Corp., Federated Investors Inc. and Rydex Investments. However, with these strategies also comes added risk so you can bet the regulatory bodies and watchdogs will be keeping a close eye on funds that employ them.
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