Rising commodity prices impact consumers and investors differently. While consumers worry about costs, investors can benefit. Investing in gold mining companies can be more profitable than gold itself due to increased profit margins and debt reduction. Just like oil exploration companies benefit from rising oil prices… gold mining companies too benefit from rising gold prices.
The Hindu accounting year began with an upgrade from global brokerage Goldman Sachs which said India is expected to see “the best structural growth prospects in the region” with mid-teens earnings growth over the next two years.
The impact of inflation on portfolios highlights the importance of considering asset classes that can provide a hedge against inflation, such as equities and real estate despite a challenge on growth. Investing in volatile markets can be a daunting task, with unpredictable price swings and heightened uncertainty.
As a result, many investors offload their positions and suffer decapitating losses in the process. Instead of adopting such a reactionary approach toward equity investing, retail equity investors ought to follow a few simple steps to utilise such downward cycles to strengthen their stock portfolio.