In fact, as individuals, there is no way that each of us can deal independently with inflation. You just have to accept it and endure it. Here, we will give you opinions related to financial technology, such as the operation of extra funds. Inflation is a phenomenon where prices go up, so in other words, the relative value of money goes down. It would be advantageous to invest in physical assets rather than money duing inflation, but it’s not really like that.
For example, if you invest in a raw material fund or a raw material ETF (listed index fund), you invest in a real asset called raw material. But didn’t I tell you earlier that after inflation, the recession used to follow? If the economy slows, demand shrinks, putting downward pressure on raw material prices. In particular, if the economy collapses badly, raw material prices also plunge.
I think it’s more important to have liquidity to cope with agility than to bury money in specific assets. If interest rates go up on stocks, raw materials, or real estate, prices are under downward pressure. If interest rates go up steeply like these days, that’s all the more so. If you have extra money, you will have a chance to invest on cheap assets at a good price, so I don’t think tying money to certain assets is a good choice from a financial perspective during inflation.
Interest rates have risen a lot this year, with banks’ one-year fixed deposit rates exceeding 3%. Interest-rate products sold by securities firms often pay more than 4% interest. I would like to advise you on the choice of finding opportunities in the asset market while earning high interest income by subscribing to short-term financial products. Inflation lowers the value of money, but I think it’s a time when cash is king from an investment point of view.