While inflation has cooled off somewhat, it is still high and investors are feeling the burn of rising prices on everything from food to fuel. As the costs of goods and services rapidly increase, conventional cash savings lose purchasing power over time. Even fixed income investments like bonds lose appeal as interest rates rise. While no investment provides complete protection against inflation, diversified stock index investing historically delivers attractive inflation-adjusted returns. By focusing on low-cost, passive index funds tracking the broad market, investors can take advantage of equities as an inflation hedge.
© 2024 Shal Ahmed
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