Over the last several years, HOOPP has built up a competency in the use of derivatives to implement active management programs more efficiently and construct investment portfolios.

By incorporating derivatives into carefully designed investment strategies, HOOPP can efficiently:

• manage foreign exchange risks
• implement defensive strategies to reduce risks within portfolios
• manage and rebalance asset mix
• generate value-added investment returns
• more effectively match assets to liabilities (reducing the prospect of funding shortfalls)

For example, it is often more efficient and cost-effective to carry out asset mix adjustments using a derivative than it is to buy or sell the securities underlying that derivative. This is because a derivative:

• has significantly lower transaction costs
• is more liquid than the underlying securities