Inflation Hedge

Inflation hedge is an investment that retains its value amid inflation. In other words, the monetary value of these investments should tend to increase roughly as fast as the rate of inflation.

Not all price increases are due to intrinsic inflation, however, in which case a traditional inflation hedge may not protect against it. An inflation hedge may not work to protect against increases in energy prices due to radical environmentalism, for example.

Traditional inflation hedges include:

• gold
• other commodities, such as oil, food, metals or grains
• real estate
• collectibles^[1]
• high-dividend stocks

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