Equities Offer Inflation Protection: BofA’s Subramanian

by | Mar 25, 2023 | Inflation Hedge | 17 comments

Equities Offer Inflation Protection: BofA’s Subramanian




The U.S. economy is “going through a massive regime change where the pressures are inflation, rising interest rates, energy prices at levels that we haven’t seen in quite a while, and these are probably stickier than they have been in prior cycles,” Savita Subramanian, BofA Securities head of US equity and quantitative strategy, says during an interview with Jonathan Ferro on “Bloomberg The Open.”…(read more)


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Equities are considered to be one of the best options for investors seeking inflation protection, according to a recent note from Bank of America’s Chief Investment Strategist, Savita Subramanian.

While inflation is a concern for many investors, equities provide a long-term hedge against rising prices due to their ability to grow and generate returns. Over the years, equities have produced returns that have outpaced inflation, providing investors with a positive real return.

In her note, Subramanian highlights that while other assets like bonds, gold, and real estate may also offer some level of protection against inflation, they may not necessarily provide the same returns as equities over the long term.

She also notes that equities provide the added benefit of dividend yields, which can offer a source of income to investors. Dividend payments tend to rise over time, providing additional protection against inflation.

Furthermore, equities offer investors diversification benefits as companies across multiple sectors and geographies can be included in a portfolio. This diversification can help minimize risk and also provide greater opportunities for returns.

See also  How To Protect Savings From Inflation

Subramanian also advocates for investing in value stocks, which she believes will outperform growth stocks in the current economic climate. Value stocks are those that are currently undervalued by the market based on their fundamentals such as valuation ratios like price-to-earnings or price-to-book.

In summary, equities are a recommended option for investors looking for inflation protection in their portfolios. By diversifying across a range of companies from different sectors, regions, and focusing on value stocks, investors can potentially mitigate risk, generate returns, and earn consistent dividend income.

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17 Comments

  1. sbkpilot11

    bonds are in a bear market? Even now, after a 16-18% collapse?

  2. h l

    Bs

  3. W M

    Good guest

  4. Sean Yun

    AGAIN AND AGAIN ONLY SAFE HAVEN ASSETS ARE GOLD (= RESERVE CURRENCY) + OIL ( RELIABLE ENERGY) !!!!!!:)

  5. Sean Yun

    AGAIN DO THE MATH ———- > WE WILL SEE ANOTHER RECORD HIGH INFLATION FOR MAY WHICH WILL BE + 8.6% – +8.8%!!!!!!!:) AND JUNE CPI WILL BE MORE THAN +9%!!!!!:) BECAUSE AS I'VE SAID MANY TIMES SINCE 3RD Q OF 2021 THAT US T-BONDS YIELDS ESP 10YR YIELD HAS BEEN TOOOOOOOOOOOOOOOO MUCH SKEWED TO DEAL WITH US INFLATION AND NOW IT IS GOING EVEN MORE DISTORtED BY THE FED + ?!:)!!!!!!!!!!!!!!!!!!

  6. Giovanni Dan Luca

    Can you make a video explaining how beginners can make huge profit within a short period of time? I mean i was at a seminar and the host spoke about making well over $880,000 within 4months of investing $150,000 i just need to know how…

  7. Sean Yun

    AGAIN AND AGAIN US FED IT IS TOOOOOOOOOOOOOOOO LATE TO HIT THE BREAK!!!!!!!!!!:)

  8. Sean Yun

    IN FACT US ECONOMY IS ALREADY IN A. BEGINNING POINT OF RECESSION!!!!!!!:) HOWEVER THE US FED WANTS TO AVOID CONSECUTIVE (-) GROWTH OF 2ND Q AFTER 1ST Q SO THEY STILL WANT MARKET TO BE IN A BUBBLE STATE MEANS THEY TRY TO REMOVE THE POSSIBILITY OF 75BP = 0.75% RATE HIIKE ON JUNE 15TH AT THE FOMC MEETING AND TRYING TO SUPPORT FINANCIAL MARKETS SUCH AS STOCKS BONDS ETC TO INCREASE US CONSUMPTION THROUGH SO CALLED WEALTH EFFECT!!!!!!!!!!!!!!!! HOWEVER WHAT THE FED IS GOING TO DO WITH THE HIGH INFLATION? NOTHING!!!!!!!!!

  9. Sean Yun

    AGAIN S&P 500 INDEX IS GOING DOWN TO THE LEVEL OF 3150- 3350 BY SEP OF 2022!!!!!!!!!! SELL OFF STOCKS BONDS US$ BITCOIN EVERYTHING RELATED WITH US STOCKS!!!!!!!!!!:) AND BUY GOLD + OIL WHAT ELSE CAN YOU HEDGE AGAINST THE STAGFLATION?!:)

  10. Sean Yun

    AGIAN AND AGAIN ———– > GOLD PRICE WILL BE IN THE RANGE OF 3.5K$ THIS YEAR AND IT WILL ULTIMATELY IN THE RANGE OF 10K$ -15K$ IN COMING YEARS AND OIL PRICE WILL BE IN 140$ BB/LS EITHER IN JUNE OR IN SEP AND IT WILL BE IN THE RANGE OF 200$ BB/LS TO 240$ BB/LS IN 2023 -2024!!!!!!!!!:)

  11. Sean Yun

    AGAIN YOU WILL SEE THAT US ECONOMY WILL BE IN THE HUGE RECESSION BY THE END OF SEP OF 2022!!!!!!!:) HAS IT ANY OTHER OPTIONS? ————- > ' NOPE' 'NEVER' AVOID THE RECESSION IN 2022!!!!!!:) ———- DO THE MATH IF YOU CAN!!!!!!!!!!!! P.S ONLY WAY TO AVOID IT? AGAIN THAT'S IS KEEPING INTEREST RATES LOWER AND LOWER MEANS EMBRACING MORE AND MORE INFLATION LIKE + 8% +9% + 10% —–> + 15% !!!!!!!!:) SO AGAIN THE QUESTION IS THAT US FED DEALS WITH INFLATION = PRICE STABILITY? OR JUST MAKING MORE AND MORE BUBBLES = KEEPING LOWER AND LOWER INTEREST RATES?!!!!!:)

  12. Sean Yun

    🙂

  13. Thomas Rudzik

    FORTUNE: "Deutsche Bank" RAIDED over ESG ‘GREEN WASHING’ claims: ESG investing has "Become" increasingly IMPORTANT for "Professional Investors" looking to AVOID "Getting Saddled" with STRANDED "Assets" that will DEPRECIATE "Quickly" in a LOW-CARBON "Economy", but "Reputational" FACTORS have "Recently" created CONFUSION about WHAT? Exactly, is Considered ESG?

  14. Phil Olen

    you want to beat Inflation Join it — trade /CL Crude — /NG natgas — gasoline I am & just Killin it —

  15. Frederick Miles

    Its a trap – equities are the most inflated asset class and the crash hasnt happened yet, just more can kicking by corrupt actors. There isnt enough collateral or cash (due to monetary deflation) – literally actors don't have the cash or collateral to take advantage of multiple swap arbitrage opportunities as we slip further and further towards a depression.

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