Hedge Against Inflation

Hedge Against Inflation

To take steps to limit the reduction of the value of an investment due to inflation. Inflation decreases the value of money such that an investment's return is not worth as much as it might have been when the investment was made originally. Hedging against inflation helps reduce this pressure. Examples of hedging against inflation include buying commodities such as gold or purchasing an inflation-protected security, in which the return is linked to the inflation rate. See also: Real Rate of Return.
References in periodicals archive ?
Gu said he expected sufficient demand for the contract from both industrial and financial clients as they needed a tool to manage risk, and hedge against inflation.
Gold remains a good hedge against inflation as well as any financial uncertainties and is therefore a preferred asset within any prudent investment portfolio.
Stocks that can offer potential hedge against inflation are those that have relatively low equity risk premium.
A diversified commodity index is a better hedge against inflation than any single commodity, according to Kurt Nelson, partner at Summerhaven Investment Management.
The poundEe's woes also make it difficult for Zain to repatriate profits, leading it to invest in local real estate as a hedge against inflation as well as raising the unitEe's capital expenditure.
It has been a store of value, a traditional hedge against inflation, a safe haven or refuge at times of political and economic upheaval as well as a prominent feature in successful wedding negotiations in the Sub-Continent.
With significant tax advantages, a possible hedge against inflation, and potentially high yields, commercial real estate may be exactly what investors are looking for.
He further added, "AMNGF provides a hedge against inflation or currency devaluation and is also a mean of diversification for investment portfolios.
These assets not only raised their standard of living but also gave them hedge against inflation.
There is only one proven hedge against inflation and that is a strong currency.
Although many central banks have dedicated to provide a low inflation environment, investors, particularly long-term investors would prefer an asset that provides a complete hedge against inflation.
Federal Reserve Chief Janet Yellen suggested interest rates could rise sooner than many had expected, denting bullion's appeal as a hedge against inflation.