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Commodities as inflation protection: Why your portfolio needs real assets

Commodities are the most direct hedge against inflation. 0.82 correlation to money supply. Learn how to build your portfolio to be inflation-proof.

What you'll take away from this article
  • How to apply the core concepts from this article to your financing strategy
  • Which concrete steps you can take next — practical and actionable
  • Why this knowledge gives you a measurable advantage in raising capital

Commodities as protection against inflation: The scientific basis

Huber analyzes the correlation between money supply and raw material prices (Figure 72, 73). The result: Commodities are the most direct inflation hedge.

0.82 Correlation of money supply to commodity prices (1970-2020)
Commodities vs stocks in inflationary phases
1970-1982 +185% Shares +52% 1990-2008 +420% Shares +68%

Commodities beat stocks in inflation

In both inflationary phases (stagflation 1970-82 and commodity boom 1990-2008), commodities massively beat stocks.

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Akademische Quelle: Master Thesis
Entwicklung einer optimalen Asset Allocation in Zeiten expansiver Geld- und Fiskalpolitik
Daniel Huber, M.A. — Hochschule Mainz, 2020 | Betreut von Prof. Dr. Arno Peppmeier
13.174 Wörter · 92 Abbildungen · 39 Tabellen · Markowitz-Effizienzlinienanalyse
Vollständige Thesis herunterladen (PDF, 6 MB) →
DH
Gründer & CEO von CANVENA | 215 Mio. USD Track Record
Your advantage after this article

What you now know — and how to use it

  • You know the core concepts and can apply them directly to your situation
  • You know which mistakes to avoid — saving you time and capital
  • You understand how this building block fits into your overall strategy

Your next step: Have your situation professionally assessed — free and non-binding in an initial consultation with Daniel Huber.

Sources & Further Reading

This article is based on a review of leading expert literature and curated primary sources from the CANVENA source matrix — more than 60 core books and 120 online resources across all relevant fields from capital intelligence, family office, strategy and valuation.

Books

  • Lords of FinanceLiaquat Ahamed, Penguin Press.
  • This Time Is DifferentCarmen M. Reinhart & Kenneth S. Rogoff, Princeton University Press.
  • The End of AlchemyMervyn King, W.W. Norton.
  • Manias, Panics, and CrashesCharles P. Kindleberger, Wiley.

Online Resources & Industry Reports

Links are recommendations, not affiliated.

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