One of the Best Strategies to Inflation-Proof Your Investments (Full Details Inside)

[TradeSmith Daily]( One of the Best Strategies to Inflation-Proof Your Investments (Full Details Inside) I’ve said this before but it’s very much worth repeating: With skyrocketing inflation in a turbulent market, you need an edge that can deliver both inflation-proof performance and current income from your investments. Research shows that one of the best ways to inflation-proof your investments is with commodities. The only problem is that commodity futures contracts have zero dividend yield and can be difficult to trade. In a study titled “The Best Strategies for Inflationary Times,” researchers found that both stocks and bonds perform poorly during inflationary times. The annualized real return of U.S. stocks (after adjusting for inflation) averaged minus-7% during eight inflationary periods since World War II. The one major asset class that does reliably outperform when inflation is running hot, as it is right now, is commodities with real returns averaging a whopping 14% per year! As you can see in the chart above, real assets such as commodities, energy, and real estate beat inflation during the 1970s. They also outperformed the stock market by a wide margin. But as mentioned earlier, investing directly in commodities is not an easy game for most investors. RECOMMENDED LINK [New Tool Reveals When to Sell Any Stock Before It Nosedives – Check Your Portfolio Now!]( The market has been on a wild ride. But the big crash of 2022 could be just around the corner. The answer this time around is NOT going to cash – where inflation can make you poorer. Instead, Nobel Prize-winning research has led to a way of identifying the day some stocks will crash, so you can lock in profits. It’s only possible if you know the secret 4-digit “Cash Out Code” attached to each stock you own. [Check your stocks now to crash-proof your portfolio!]( For one, you’ll need a commodity futures trading account, which is generally not offered by most brokers. Second, larger margin trading requirements for trading means that you’ll most likely need a sizeable account to get started. Third, the leverage involved means you can earn large gains if you’re right, but it also means you’ll take big losses if your trade timing is off. As an alternative, there are ETFs that track commodities, but most don’t do a very good job of delivering on the upside. Commodity ETFs suffer from what’s called “negative roll yield,” which is a fancy Wall Street phrase that means you don’t always get what you pay for. For instance, ETFs that track commodities like oil must continuously roll their futures contracts from one month to the next. But most of the time, next month’s oil futures contract is priced higher than the current month’s contract is worth. That means an oil-tracking ETF loses value every time it rolls its oil futures contracts. And after several months, the oil ETF’s performance doesn’t live up to the actual gains from crude oil itself. So, what’s an investor to do? Is there a reliable way to earn inflation-proof gains without the hassle of buying commodities? In my book, the easiest and most economical way to invest in commodities is through buying high-quality, dividend-paying stocks that produce commodities. An added advantage is that commodity stocks often outperform the commodity itself, thanks in large part to the rich dividend yields they can offer investors. For instance, everyone knows energy prices have been through the roof this year. But crude oil is up less than 2% since early March. RECOMMENDED LINK [What Is the Next Gen Coin?]( Experts are saying it will be 20 times bigger than bitcoin at its all-time high. [Get the full story here]( Meanwhile, the SPDR S&P Energy Sector ETF (XLE), which tracks large energy-producing stocks, is up more than 7% over the same time period. That’s nearly four times more upside from oil stocks than from the price of oil itself. Plus, the energy sector stocks that make up XLE pay you a generous dividend yield of 3% on average while you wait for more price gains from energy stocks. And many of the top stocks in this ETF pay even more. - Exxon Mobil Corp. (XOM) offers you an 3.9% dividend yield. - Chevron Corp. (CVX) pays a 3.2% annual dividend. - Devon Energy Corp. (DVN) pays out a fat 6.3% dividend yield! That’s why one of the very best ways to benefit from the big rise in commodity prices is by owning high-quality, dividend-paying commodity stocks. Good investing, Mike Burnick Senior Analyst, TradeSmith P.S. It’s now possible to x-ray your entire portfolio to know which stocks are costing you potentially thousands of dollars and which are good investments to keep, thanks to something called “Cash Out Codes.” Every publicly traded stock, ETF, and mutual fund has a unique four-digit “Cash Out Code.” This code reveals when to sell your shares to maximize your potential return — and it can warn you of coming crashes. [Click here now]( to get the unique Cash Out Code for each of your stocks. P.P.S. You’re invited to join our Product Education Lead, Marina Stroud, for her free Beginner Bootcamp training session. Today she will lead a live presentation on creating portfolios. She will cover the basics of importing your brokerage account, creating a watchlist, and importing a spreadsheet of securities. She will also discuss the various columns of information to customize your position views. This lesson covers the portfolio creation and management features found in TradeStops by TradeSmith, Trade360, and Crypto by TradeSmith. [Click here to register]( for today’s webinar. Our webinar will begin at 1 p.m. Eastern. We will include time at the end for a question-and-answer session. Best of TradeSmith The chart below represents the best-performing open positions over the last two years, as recommended by our software. [Download now on the Apple Store]( [Get It On Google Play]( [866.385.2076](tel:+866-385-2076) | support@tradesmith.com ©TradeSmith, LLC. All Rights Reserved. You may not reproduce, modify, copy, sell, publish, distribute, display or otherwise use any portion of the content without the prior written consent of TradeSmith. TradeSmith is not registered as an investment adviser and operates under the publishers’ exemption of the Investment Advisers Act of 1940. 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