As the dust settled two years ago at the end of the most recent bear market, many investors were forced to pick up the pieces of their investment portfolio and retirement accounts. Most equity mutual funds ended the period down more than 40%, and it seemed as though the investment landscape would never be the same. This downturn broke all the rules about padding one's portfolio with proper asset allocation. The problem was that as the global markets crashed, the correlation between opposing asset classes began to increase.

As money began to come back into the market, investors and advisors thought differently about portfolio creation and diversification. Both a higher level of risk aversion and the case for better risk diversification had been made, with the impact seen in allocations and products. On the core side, exchange-traded products began to proliferate and garner large amounts of assets. But demand for actively managed funds also continued.

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