Inflation hedge

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An inflation hedge is an investment intended to protect the investor against (hedge) a decrease in the purchasing power of money (inflation).

Barron's Finance & Investment Handbook states: "Traditionally, gold and real estate have a reputation as good inflation hedges, though growth in stocks also can offset inflation in the long run. Money market funds, which pay higher yields as interest rates rise during inflation times, can also be a good inflation hedge."[1]

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References[edit]

  1. ^ John Downes & Jordan Elliot Goodman, Barron's Finance & Investment Handbook (6th ed.: Barron's Educational Series, 2003), p. 496.