Another technique for reducing the risk of losses is hedging. With hedging, you look for securities that have a negative correlation. This means that when one security tends to rise, the other security tends to fall. For example, you can simultaneously invest in the US dollar and the price of gold. When the economy is struggling, people often flee to gold, and the price of gold rises while the dollar falls. If you invest in stocks, you can buy stocks from cyclical and anticyclic companies. Cyclical companies perform well when the economy is growing, while anticyclic stocks perform well when the economy performs poorly.