What is an inflation-hedging portfolio?
An inflation-hedging portfolio is designed to protect against the loss of purchasing power due to inflation. It typically includes assets that tend to increase in value when inflation rises.
What types of assets should I include in such a portfolio?
You might consider including real estate, commodities, inflation-linked bonds, and stocks of companies that can pass on costs to consumers.
How do I determine the right allocation for these assets?
The right allocation depends on your risk tolerance, investment goals, and time horizon. A financial advisor can help tailor a strategy for you.
Are there any risks associated with an inflation-hedging portfolio?
Yes, risks include market volatility, potential underperformance of certain assets, and the possibility of inflation not rising as expected.
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