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The Most Effective Investment Strategies During Inflationary Times try to Run Away from Cash and Toward Equities Among the several options, an investor must make to combat inflation, maybe the most excellent advice is the simplest to implement. Maintain an equity position.
It is clear and honest advice. When a business’s costs go up, it may simply raise prices to make up for them, which means more money and profit. A good thing for both the company and the person who invests in it. It is the perfect inflation hedge for someone who wants to keep their money in the right places. Investors who are worried about inflation may want to invest a few more percentage points of their portfolio in stocks to ease their fears. Keep in mind that we said this inflationary era is short-lived; if prices fall, investors can simply unwind this extra allocation.
As a side note, keep in mind that this time around, savings rates aren’t going up as much because of inflation. This is different from when there was a lot of inflation in the past when savings rates rose along with interest rates. Investors who are in the equities market can earn more money over time, which means they have more money to buy things.
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