Stocks are trading lower this morning as potential inflation weighs heavy on Wall Street sentiment. The 10 year treasury yield traded at 1.37%, its highest level since the pandemic began.
Thorsten Polleit, chief economist at Degussa recently commented, “At the moment inflation is impacting asset markets. But the increase in the quantity of money that has been printed in the U.S. as well in the Euro area inflation will sooner or later also push up consumer prices.”
Investors can at least minimize its effects using exchange-traded funds that incorporate an inflation-hedging via Treasury Inflation-Protected Securities (TIPS).
An ETF to consider is the iShares TIPS Bond ETF (TIP). The investment seeks to track the investment results of Bloomberg Barclays U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L) which composed of inflation-protected U.S. Treasury bonds. The fund generally invests at least 90% of its assets in the bonds of the underlying index and at least 95% of its assets in U.S. government bonds.
iShares TIPS Bond ETF (TIP)
- Net Assets 26.39B
- Yield 1.17%
- 52 week performance + 5.62%
- YTD Total Return -1.38%
- Expense Ratio 0.19%
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