How to Invest in an Inflationary Environment

The U.S. CPI surged to a 40-year high, leading to market expectations that the Fed may continue to push with quicker and larger rate hikes. Despite being in a falling market, we need not focus purely on losses. We can turn our perspective around and see what is presented to us as an opportunity. Below are some investment ideas for the current market environment.

Quality Stocks

A rising market underlines risks, while a falling market brings opportunities. When panic prevails and stock prices fall precipitously, savvy investors attempt to benefit from the rebound via stocking up on quality stocks. Stocks with strong fundamentals and good long terms prospects are great stocks to buy now.

Inflation-related ETFs

As the U.S. inflation surged to a record-high level, many investors are looking to hedge against rising prices, which leads to a soaring demand for investing in inflation-related assets. It’s also worth noting that many inflation-related ETFs have all witnessed a sharp increase.

Options to hedge

In times of great market volatility, you may encounter a sharp drawdown scenario in the short term if you hold shares of a stock. However, if you are bullish on the stock in the long run, options may help to hedge against your stock positions and secure some gains.

Sign up with Moomoo

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Bonus

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Written by Moomoo, in collaboration with StocksCafe.

Disclaimer: The content in this article (the “Information”) is not and shall not be construed as investment advice. This Information is meant to be informative and for general purposes only. Investment involves risk. Past performance is not indicative of future performance. Investors should refer to the offering documentation of the product(s) for detailed information (including risk factors) prior to investing in the product(s). If you have any query on the above information or any product offering documentation, you should seek independent professional advice.