7 Ways to Hedge Against Inflation
Jim Woods, June 24, 2009
Free Trading Guides
-
Inflation Hedge #7: Short the Long Bond
When inflation is on the march, long-term Treasury bonds lose their mojo. That means you will want to check out investments that move the inverse of the price of long bonds. Another way to put it is you will want to invest in funds that move higher as bond yields, i.e., interest rates, move higher.
A great way to do that is to own the UltraShort 20+ Year Treasury ProShares (TBT). This investment seeks daily investment results that correspond to twice the inverse of the daily performance of the Lehman Brothers 20+ Year U.S. Treasury Index. The leverage involved here means that if bond prices fall 2%, then TBT should climb 4%. Now that's what we call an inflation hedge!
Find out why TBT is one of the 8 China and Emerging Markets Plays you should buy now.
More By This Expert
Dawn Pennington
Time, Price and an Option's Profitability
It's one thing to bet on a stock making a $5 move. It's another thing entirely to expect it to happen in too short a period of time. Learn why some options finish in-the-money and others don't.
Read This Before You Buy Another Stock
A savvy stock position can start with a single options trade.
This technique can help you breathe a sigh of relief as it aims to relieve a 'choking' portfolio.
If you are familiar with buying calls and puts, we'll show you how to buy them even cheaper.
Anatomy of a Stock Option Ticker
Option tickers may look like a bowl of alphabet soup to you, but each letter means something.
MOST POPULAR
- What's Hot: DELL, DHI November 20, 2009
- Sidewinder: MCD, DKS, JPM November 20, 2009
- Options News: SII November 20, 2009
- Sidewinder: CY, ADSK, KG November 19, 2009
- Options for Dummies November 19, 2009
Options Broker Center
