Commodities are a better hedge than bonds in inflationary environments, and multi-asset investors should re-consider commodities as a strategic holding in portfolios, according to Schroders.
Commodities have come under greater scrutiny in recent months. Being one of the only winners in 2022, where most assets saw huge declines, investors have been asking if commodities should play a more strategic role in multi-asset portfolios.
The post-global financial crisis era saw an unprecedented period of loose monetary policy combined with low and steady inflation. That has since come to an end, and looking ahead, we’re expecting a more “typical” period of inflation.
There are parallels between the recent bout of inflation in 2022 and the past, and the firm believes this period holds interesting insights for commodities in the new regime.
To read the full report,