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Sep 29, 2022 · Stagflation — that mix of rising prices and slow growth — hasn’t cast a shadow over the U.S. economy in four decades, but experts say the warning signs are flashing like strobe lights at a ...
- Coryanne Hicks
Jun 28, 2022 · Stagflation investing is essentially a defensive approach to managing an investment portfolio to minimize the risks of rising prices and a shrinking economy. Developing an investment strategy for stagflation means: Identifying investments that are more likely to be insulated against the effects of rising inflation and slowing economic growth.
Feb 13, 2023 · Investors need to know that stagflation can cause losses when it comes to equities. Despite persistently high inflation throughout 2022 and many aggressive interest rate hikes from the Federal...
- Commodities and Precious Metals. Commodities like gold, oil, precious metals, and agriculture tend to perform well during Stagflation, and there are several logical explanations why
- Defensive Stocks. Defensive stocks, also known as non-cyclical stocks, are those in the consumer staples and healthcare sectors, that can provide stability and potential growth during stagflationary periods.
- Real Estate and REITs. Real estate investments, including rental properties and publicly traded REITs, can serve as a hedge against inflation and provide reliable returns during Stagflation.
- Treasury Inflation-Protected Securities: Another popular Stagflation investment is Treasury Inflation-Protected Securities, known as TIPS. These securities are government treasury securities that provide a real return that is linked to the Consumer Price Index, which is the widely accepted benchmark for inflation.
- What Does Stagflation Mean? The Worst of Both Worlds
- What Assets Do Best in Stagflation?
- Strategies For Beating Stagflation
- Final Thoughts
Stagflation is seen as the worst of both worlds. High levels of inflation, which are at 40-plus year highs of 9.1% in the US, are beginning to weigh on demand. But falling demand is unlikely to adequately cool rising prices. Energy costs remain artificially high following Russia’s invasion of Ukraine, and demand is rebounding faster than supply cha...
The playbook for investing during stagflation is completely different to that used in the prolonged bull marketera of 2020 and 2021. It eschews higher-risk equities such as growth stocks and crypto in favour of value and assets that do well in a recession. The added pressure comes in also trying to outpace inflation, which could mean investors requ...
It’s important to consider what to invest in during stagflation, but it can be just as important to consider how to invest.
All investments carry risks at any time. Those risks are heightened during periods of high inflation and low economic growth, particularly when things are finely balanced between stagflation and a recession. “Stagflation wouldn’t be good for anyone but some assets would likely be better than others. Investors might turn to real assets with links to...
May 2, 2022 · Lyn Alden Schwartzer. Investing Group Leader. Follow. Summary. This article provides data and examples for how (and why) various assets typically perform during stagflationary environments....
Dec 11, 2023 · Stagflation is a period of stagnant economic growth accompanied by persistently high inflation and a sharp rise in unemployment. While stagflation is quite rare—the U.S. has only experienced...
