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Portfolio insurance
A management strategy intended to guarantee a floor value of a portfolio or to limit the risk of loss to a certain level in exchange for giving up a portion of the potential gain.
The initial concept was to constantly balance asset allocation between low-risk and high-risk assets. The term was subsequently applied to a technique involving the sale of index futures to limit the risk of loss. The meaning of the term was finally broadened to all strategies intended to limit the risk of loss on a portfolio, most often by using derivatives.