Inflation has spiked to its highest level in four decades. Traditional inflation hedges, like TIPS or precious metals, aren’t cutting it, and investors are concerned about pricing pressures eating away at their portfolios.
In the upcoming webcast, Inflation Strategies: How to Survive Extraordinary Times, James Davolos, Portfolio Manager, Research Analyst, Horizon Kinetics; and Robert Sechan, CEO, Managing Partner, Co-Founder, NewEdge Wealth, will outline an updated inflation hedging strategy that could help financial advisors’ clients better cope with the current inflationary pressures.
“It is important for investors to protect their portfolios, but we believe many traditional inflation hedges/ inflationary investments are suboptimal,” according to Horizon Kinetics. “There are limited investments that address inflation risk without being a directional trade based on CPI.”
Alternatively, the Horizon Kinetics Inflation Beneficiaries ETF (INFL) is an actively managed ETF seeking long-term capital growth in real (inflation-adjusted) terms. It aims to achieve its investment objective by investing primarily in domestic and foreign equity securities of companies that are expected to benefit, either directly or indirectly, from rising prices of real assets (i.e., assets whose value is mainly derived from physical properties such as commodities) such as those whose revenues are expected to increase with inflation without corresponding increases in expenses.
INFL is an ETF strategy to address rising inflation concerns. INFL will own stocks and invest in the equity of currently profitable and well-managed companies. It avoids the typical industry focus on traditional investment categories and attempts to find unique, undiscovered, long-term value and price appreciation drivers.
The portfolio is designed to provide a total cycle inflation exposure and seeks to thrive under many different inflation scenarios. INFL emphasizes companies that have exposure to inflationary underlying assets yet do not have high capital intensity. This is a key feature differentiating INFL from other products intended to hedge against inflation.
Financial advisors who are interested in learning more about inflation hedging strategist can register for the Friday, March 25 webcast here.