Positioning amidst High Inflation
Invest in inflation resilient strategies
The latest inflation print has surpassed another 30-year high. Just by low base effects, y/y effects, inflation will stay elevated this year. To curtail inflation, the U.S Federal Reserve has raised the first in a series of rate hikes this year by 25 basis point on 16 March 2022. Further, a combination of Fed hike cycle and geopolitical uncertainty are expected to keep volatility elevated across both equity and bonds markets.
In such an environment, we suggest investors look at inflation resilient strategies to stay ahead of the cost curve. One such area would be Commodities, whose prices tend to rise in times of elevated inflation.
So, what would be our top fund idea within this space?
Schroder AS Commodity Fund
What are the key characteristics of this fund?
- Co-managed by a 3-member investment team of sector experts, with deep knowledge in various parts of the commodities market and an average experience of about 20 years.
- The team focuses on long-term fundamental macros impacting different commodity segments, overlaying it with quantitative short-term signals.
- Fund investments are divided into 3-core areas of the commodities market – Energy, Metals and Agriculture, providing a diversified exposure to the space.
- It is primarily invested in commodity futures; with some exposure to swaps, physically backed Exchange Traded Commodities, and equities.