Serial entrepreneur Andrew Wilkinson, who is the co-founder of Tiny Capital which owns more than 40 companies including Dribble and AeroPress, pegged his 190,000 Twitter followers asking for the best inflation hedges that an investor can purchase right now.
“Could be stock, options, bonds, whatever,” Wilkinson said in a Sept. 22 tweet.
Economic backdrop: There are numerous factors contributing to the slowing of the world economy. An energy crisis in Europe is hurting people's finances and reducing industrial output.
The effects of the COVID regulations and the slump in the real estate market are being felt in China.
In order to slow the spike in inflation brought on by a restoration of post-lockdown consumer activity and excess savings, central banks in the U.S. and around the world are aggressively tightening monetary policy.
Also Read: S&P 500 Gives Up Early Week Gains Following Latest Jobs Report: Is A Recession Looming?
The ability of monetary authorities to pull off a soft landing — that is, to lower demand enough to bring inflation down from near 40-year highs without plunging the economy into a severe or protracted recession — is being increasingly questioned.
With that said, Wilkinson's tweet received comments from followers who shared their opinions on the best ways to hedge against inflation. We have compiled the top 10.
1. User Edward Bloat @edwardbloat said,
High-yield dividend stocks in a 401(k).
Accrue value tax-free.
For non-sheltered accounts, buy the dips on Amazon.
On an inflation-adjusted basis, it is under its 2018 values when trading under $118.
2. Matthew Iwama @MatthewIwama said,
I like publicly traded trucking companies: TFI International Inc (NYSE:TFII), etc.
They are the ones having record years since COVID. Transportation costs are the source of most consumer inflation.
3. Chris Katje @chriskatje said,
Vintage baseball rookie cards like the Hank Aaron Rookie Card on Rally that had [its] IPO yesterday. Fractional investing for the win.
4. David Koblas @koblas said,
Debt collection agencies or the services they depend on.
5. Louis Winthorpe @Lwinthorpe said,
"Commodities producers likely best bet. Nothing much else likely to work next 6 -12 months… some things should work beyond that … but gon be a rough ride … your cashflow generating businesses gonna be hard to beat."
6. Craig Cambell @craig_cambell said,
Activision Blizzard, Inc. (NASDAQ:ATVI): arbitrage from the Microsoft Corporation (NASDAQ:MSFT) takeover. 25% discount to buyout price, expected to close by June 2023
British American Tobacco PLC (NYSE:BTI): 7-8% dividends, tobacco tends to do well both in recession and inflationary environments.
7. Tom @88_tc_88 said,
Trade? I'll give you 2 investments
Bitcoin (CRYPTO: BTC) $btc - what we're facing is a sovereign debt crisis.
Ouster Inc (NYSE:OUST) $oust - automation/lidar business very misunderstood strongtech. Shortage of labour = govs will incentivize hardware automation to reduce infl. Likely the lidar for Amazon/Cruise under NDAs
8. Vijar Kohli @VijarKohli said,
I don't trade much but here's my watch list:
Bm Technologies Inc (NYSE:BMTX) $BMTX oversold SaaS. Profitable. Family has a successful history in banking.
Mp Materials Corp (NYSE:MP) $MP one of the few rare-earth material companies in America. Inflation will improve commodity margins.
Upcoming asset spinoffs: Danaher Corporation (NYSE:DHR) $DHR Laboratory Corp. of America Holdings (NYSE:LH) $LH Jefferies Financial Group Inc (NYSE:JEF) $JEF Fidelity National Financial Inc (NYSE:FNF) $FNF XPO Logistics Inc (NYSE:XPO) $XPO
9. Ryan Casey @ryansweb said, $EWZ for breaking supply chains.
Iridium Communications Inc (NASDAQ:IRDM) $IRDM for satellites
Vanguard Communication Services Index Fund ETF (NYSE:VOX) $VOX short telecom as they have maybe a decade left before Apple + Google deploy their cash on satellite infrastructure to bypass telecoms and take their market share.
10. Raphael Darty @Raphd said,
"Technically not a 'buy' idea.. short (sell) UB1 - 30Y German bunds futures. Yield now at 1.8%. Germany’s fiscal position deteriorating. If long term inflation is 3-4% rather than 2, current level [is] unsustainable. Less & less non-price sensitive buyers (BCE, EU insurers etc)."
