A traditional "60/40" allocation to stocks and bonds may no longer be enough to provide you with the returns and diversification needed to achieve your long-term goals. Over the past 10 years most portfolios carried predominantly equity risk: a 60/40 portfolio moved in the same direction as the S&P 500 Index 99% of the time1.

A look at various possible portfolio allocations using the classic "efficient frontier" curve, which shows the optimal portfolios for generating the highest returns for defined levels of risk, demonstrates the potential of alternatives. When selected for their low correlation to other parts of a portfolio, alternative investments may help lower volatility, enhance returns and broaden diversification.

The New Diversification: Open Your Eyes to Alternatives

When it comes to diversification, the “old rules” may not work as well as they used to. Incorporating alternative strategies can help to augment and diversify your sources of risk, while also introducing potentially new sources of return.

The (New) Tools of the Trade

Using the same investment processes and tools from the past limits an investor's ability to succeed in today’s environment. The world has changed and ways to manage money have evolved with it.

Market Volatility Can Erode a Portfolio's Value

Alternative investments can help you mitigate the effects of market volatility on your portfolio while providing attractive returns.

Diversification is Difficult When Correlations Are Rising

A "diversified" portfolio of stocks and bonds has been moving nearly in lock step with the stock market. Alternatives can potentially lower this correlation and dampen the effects of market volatility.

Rewarding Risk: How the Science of 'Rewarded Risk' is Redefining Diversification

Diversifying risk is essential, but it is not enough to only balance exposure to asset classes.

Source: Morningstar. Traditional 60/40 portfolio composed of 60% S&P 500 Index and 40% Barclays Aggregate Index, rebalanced annually. Past performance does not guarantee or indicate future results. It is not possible to invest directly in an index.

The information on this website is intended for U.S. residents only. The information provided does not constitute a solicitation of an offer to buy or an offer to sell securities in any jurisdiction to any person to whom it is not lawful to make such an offer.

Investing in alternative investments presents the opportunity for significant losses, including the possible loss of your total investment. Such strategies have the potential for heightened volatility and in general, are not suitable for all investors.

Diversification and asset allocation may not protect against market risk or loss of principal.

Please consider the investment objectives, risks, charges and expenses of each fund carefully before investing. The funds' prospectuses and, if available, the summary prospectuses contain this and other information about the funds and are available, along with information on other BlackRock funds, by calling 800-882-0052. The prospectus and, if available, the summary prospectuses should be read carefully before investing.

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