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TiPs Do Not Hedge Inflation as Advertised
- Marcus Nikos
- Feb 23, 2025
- 1 min read
"In some cases TIPS are a certifiably bad inflation hedge."-
TiPS performance will continue to be dictated more by Treasury market dynamics than inflation itself. For holders of TiPS to replicate what banks can do (see attached cartoon) multiple factors must be hedged and re-hedged.TiPS, like most “products” offer imperfect hedging convenience. You’re better off buying Gold and some Stocks to hedge inflation. The math has been done.
