Equity investments for inflationary environment

[Muse]

Interested in everyone's perspective on what listed equity investments might be a good hedge against / beneficiary from an inflationary environment. Let's leave aside the debate on why inflation is here, whose fault it is, and whether it is permanent or transitionary and focus on what stocks here in Australasia or abroad would be a good addition to ones portfolio if inflation was here to stay.

[stoploss]

Interested in everyone's perspective on what listed equity investments might be a good hedge against / beneficiary from an inflationary environment. Let's leave aside the debate on why inflation is here, whose fault it is, and whether it is permanent or transitionary and focus on what stocks here in Australasia or abroad would be a good addition to ones portfolio if inflation was here to stay.

Property, as the debt that comes with it is inflated away.

[Muse]

Property, as the debt that comes with it is inflated away.

true. so from a listed perspective the LPVs. and that same logic should applied to operating companies with meaningful levels of debt.

[Rawz]

My understanding is companies that have pricing power as they can easily lift their prices in line with inflation. Power companies?
And
Companies that don't require continuous reinvestment. So software based, Facebook? Or finance, banks, harmoney

[Biscuit]

Property, as the debt that comes with it is inflated away.

Maybe, but we have had a lot of asset inflation up until now. Now we are looking at higher interest rates and consumer goods inflation. Not sure this is going to be a great environment for leveraged property investment.

[bull....]

in the 70s energy stocks by far did the best cause the inflation shock was caused by high oil prices. property stocks did alright but with wild swings every other sector lost.
like with most everything in the market every time can be different so a high inflation environment this time could end up with different outcomes eg bitcoin seems to be the inflation hedge , world imploding thing at the moment

[Biscuit]

in the 70s energy stocks by far did the best cause the inflation shock was caused by high oil prices. property stocks did alright but with wild swings every other sector lost.
like with most everything in the market every time can be different so a high inflation environment this time could end up with different outcomes eg bitcoin seems to be the inflation hedge , world imploding thing at the moment

I think we might move away from a period when the easy money was passive investment - borrow and buy pretty much anything, towards an environment where active investors are the only winners.

[Mista_Trix]

Agree with companies that set their own prices and have high barriers to exit. My monies on undervalued SAAS companies with strong ARR. So far im heavily in on EVS.ax and when ERD.nz comes down to a more reasonable level I'll grab more of that too. XRO.ax is done, I think the growth has slowed too much for where it's currently valued.

[DonkeyKong]

Property, as the debt that comes with it is inflated away.

I haven’t dived into it in detail. But this would be if wages (or margins depending what you’re looking at) rise at the same or greater pace?

Otherwise, with rising inflation and rising interest rates, debt serviceability would reduce. Right?

So do wages (and/or margins) usually rise at the same pace as inflation? If not, the debt might not be inflated away and instead become a bigger issue for people?

Again, haven’t dived into it in detail, just my initial high level thoughts.

[petty]

Great thread. Look fwd to responses. Im positioning around property. Companies with food sector related debt. (debt will inflate away but food prices will rise).

Then im thinking mining companies and crypto.