8 days ago
Are #commodities starting another #bull cycle? $DJP $FCX #inflation #hedging #trading
US inflation rate came at 7% yesterday, that is 7% erosion in purchasing power since December 2020! In these inflationary periods, one effective way to hedge against inflation is through investment in real assets, like commodities. The Bloomberg commodities index (ticker: DJP), a broadly diversified basket of energy, grains, industrials and precious metals, and life stocks, had a stellar performance in 2021. The ETF outperformed the S&P 500 last year, yielding 31% return. As it is expected that inflation will remain above 3% through 2022, commodities are very likely to continue to outperform. Moreover, weaker US dollar and increasing geopolitical uncertainties have always pushed prices of this asset class higher.