Inflation Can Quickly Erode Your Portfolio's Value: This Is the ETF Type I'm Counting On as a Hedge Against That Happening
Inflation is sneaky, but here's a way you can help protect your investments.
Overview
I'd love to be one of those cool, calm investors. But the truth is, I'm a natural worrywart. While I have no interest in putting the brakes on my overall portfolio, I look for ways to minimize risks. Lately, inflation has been heavy on my mind, which makes me particularly grateful for Treasury Inflation-Protected Securities (TIPS) -- specifically those included in a high-quality exchange-traded fund (ETF).
Like other ETFs, TIPS ETFs are investment funds that pool your money with that of other investors to purchase a diversified portfolio of TIPS. These ETFs trade on major stock exchanges, allowing you to buy and sell shares just as you would with regular stocks.
Details
One advantage of TIPS ETFs is their ease of access and liquidity. Couple that with built-in inflation protection, and it's easy to see how TIPS ETFs fit neatly into the diversified portfolio of anyone who worries about inflation eating away at their investments.
Source
Originally published at www.fool.com.