12-14-2021, 03:54 AM
Best stocks to fight inflation
<!-- SC_OFF --><div class="md"><p>We all know inflation is real and it’s here to stay for the foreseeable future. As inflation picks up, we already know the FED will have to increase interest rates. The question is - how do we invest with this in mind? I’ve been questioning this for months now. </p> <p>I’ve heard two theories. The first states that inflation is no real concern for the stock market in general, in fact it states it’s actually good for the stock market. </p> <p>The second theory states that as inflation rises there tends to be an inverse relationship to stock market growth, and specifically company P/E ratios. Growth stocks tend to lose ground as P/E ratios come back down to earth. </p> <p>I tend to believe the second theory as it makes more sense to me. Low interest rates and easy money for the past decade have fueled a magnificent bull run. As rates go up, and money tightens, I believe we’ll likely see a pullback or correction in the market. To what extent? I do not know. </p> <p>So what do we do with this information? Which stocks or sectors do well during inflationary increases? From my research it’s been energy, oil, commodities, and gold. Will this trend prove to be true once again? </p> <p>I’m not claiming to have the answers, but I wanted to start the discussion.</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/gunsoverbutter"> /u/gunsoverbutter </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/rfxgk2/best_stocks_to_fight_inflation/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/rfxgk2/best_stocks_to_fight_inflation/">[comments]</a></span>Kind Regards R
<!-- SC_OFF --><div class="md"><p>We all know inflation is real and it’s here to stay for the foreseeable future. As inflation picks up, we already know the FED will have to increase interest rates. The question is - how do we invest with this in mind? I’ve been questioning this for months now. </p> <p>I’ve heard two theories. The first states that inflation is no real concern for the stock market in general, in fact it states it’s actually good for the stock market. </p> <p>The second theory states that as inflation rises there tends to be an inverse relationship to stock market growth, and specifically company P/E ratios. Growth stocks tend to lose ground as P/E ratios come back down to earth. </p> <p>I tend to believe the second theory as it makes more sense to me. Low interest rates and easy money for the past decade have fueled a magnificent bull run. As rates go up, and money tightens, I believe we’ll likely see a pullback or correction in the market. To what extent? I do not know. </p> <p>So what do we do with this information? Which stocks or sectors do well during inflationary increases? From my research it’s been energy, oil, commodities, and gold. Will this trend prove to be true once again? </p> <p>I’m not claiming to have the answers, but I wanted to start the discussion.</p> </div><!-- SC_ON --> submitted by <a href="https://www.reddit.com/user/gunsoverbutter"> /u/gunsoverbutter </a> <br/> <span><a href="https://www.reddit.com/r/investing/comments/rfxgk2/best_stocks_to_fight_inflation/">[link]</a></span> <span><a href="https://www.reddit.com/r/investing/comments/rfxgk2/best_stocks_to_fight_inflation/">[comments]</a></span>Kind Regards R