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Building a Better Inflation Hedge: The Case for Real Assets

March 2014
After witnessing the U.S. equity market rally more than 32% in 2013 and experiencing the first negative calendar year for core U.S. fixed income since 1999, investors may find themselves questioning the prospects for returns in traditional stock and bond markets going forward. In addition, continued quantitative easing from central banks around the world has many market pundits predicting the return of inflation in the not too distant future. As we outlined in a recent Rocaton Insights (The Outlook for Treasury Inflation Protected Securities, November 2013), inflation linked bonds may not provide the inflation hedge that many investors are expecting. In this Rocaton Insights we discuss potential opportunities in real assets while also outlining various considerations for these asset classes.

 

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