The Fed & other central banks have pumped an significant amount of currency into the world markets and world demand for basic goods is on the rise. Inflation is not at the door; inflation is in the house. If you fear the impact of increased inflation over the coming years, then you need to act now to position your portfolio to take advantage of this trend.
I stress agricultural based commodities because of the base need of all humans and other animals to eat. On top of that fact, a number of commodities that are used for human consumption are also used for other means. For instance sugar and corn stock can be used in human or animal consumption or for fuel. Therefore, many different avenues are available for these commodities to serve as resources to companies. As the economy grows more businesses will demand that these inputs be available and more wealth among consumers will drive prices higher, too. Couple that with an increase in the money supply and you’ve got a pretty good climate for inflation to bloom.
If you’re not sure where to start your research, take a look at some of the stock and ETFs below to help you develop some investing ideas:
BG – Bunge Limited engages in the agriculture and food businesses in approximately 30 countries.
ADM – Archer Daniels Midland Company procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally.
MON – Monsanto Company, together with its subsidiaries, provides agricultural products for farmers in the United States and internationally.
POT – Potash Corporation of Saskatchewan Inc. produces and sells fertilizers and related industrial and feed products worldwide.
MOO – Market Vectors Agribusiness ETF seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the DAXglobal Agribusiness index.
Disclosure: No Positions.