Reverse your losses with Inflation-Proof Portfolio from Gainy

Learn how you can save your capital
‍on the falling market

Start

Ready to save money?

Noticing prices going higher every time you go to the store? Your shopping cart has decreased for the same $100?

While there is no way it’s gonna improve anytime soon, there are ways to beat it.

Meet enemy #1 — Inflation

Inflation is a general increase in prices and fall in the purchasing value of money.

For example, $100 5 years ago would be
$79.1 in purchasing power now.

Here’s why you notice
inflation now. It’s 4 time higher than regular

Here’s how it’s been performing over the past 100 years.

Charting U.S Inflation Over 100 Years

Why is this happening?

Inflation has exploded because the Fed has been printing money like crazy. Their balance sheet has grown to $9 trillion from less than $5 trillion five years ago.

Save Money

Let’s imagine 5 years ago you invested in:

The stock market
(S&P 500*)

Average annual returns — 15%

*S&P 500 is an index that represents the 500 biggest US companies. When you buy it you invest in the US economy and your money grows with.

Nothing

You kept cash in a cookie jar until better times.

Our model Inflation-
Proof portfolio

Consisting of 21 stocks from 5 industries that have historically performed well.

Invest

A closer look at the difference

S&P 500 vs. Inflation-Proof TTF

The portfolio grew similarly to the S&P 500 in ordinary times, but outperformed it during high inflation.

What’s the magic?

Not everything is falling during high inflation.

After doing deep research of stock returns for over 1,400 companies starting from 1993, we found out that sectors that can transfer their costs
to the end consumer win.

What are these sectors?

For each month, we calculated
an average monthly return of the sector and subtracted the return of SPY (S&P 500 ETF) to calculate an excess return of an equally weighted sectoral portfolio.

Learn more about Inflation-proof sectors

Inflation-proof sectors

In the picture below you can see performance of sectors during low inflation (first column), normal (middle column) and high (third column) in comparison to S&P500.

Energy

Energy has a positive correlation to inflation because the revenues of energy stocks are naturally tied to energy prices, a key component of inflation indices, such as CPI(Consumer Price Index) and PPI(Producers Price Index), with the second being the predecessor of inflation for CPI.

REITs

REITs own real-estate assets and may provide a partial inflation hedge via the pass-through of price increases in rental contracts and property prices. The cost of mortgages is most often fixed, the rent increases with general inflation, which is in favor of property owners.

Banks

Banks and insurance companies historically benefit from growing interest rates. Although the cost base for banks increases, i.e fed rates at which they borrow increase, they can more than make up for it by transferring this increase to borrowers and even increasing their profit margins while doing so. Insurance companies on the other hand profit from higher fixed income yields when investing their funds in bonds.

Utilities

As natural monopolies, they should be able to pass on cost increases to consumers, but their pricing power is often limited by regulators. However, the regulator usually allows some increase in tariffs caused by higher energy prices and inflation, which helps companies maintain profit margins and sometimes even slightly increase them.

Food

Food and staple retailers can usually transfer the growing cost of goods to consumers and even increase profit margins given enough consumer spending power. At periods of high inflation profit margins across the sector are under pressure due to rising distribution and logistics costs. However, retailers have the highest bargaining power in the supply chain due to their scale and pass increased logistics cost either to suppliers or end consumers, hence maintaining profitability.

Are all companies falling?

Here’s how they have been performing in other years with high inflation.

Obviously, not ALL companies from these sectors perform the same way, so we had to dig deeper and hand-picked 21 with the best fundamental metrics.

Protect your savings now by investing in the inflation-proof portfolio made by Gainy

9 trillion dollars of printed money won’t magically disappear. Financial institutions predict inflation to be at least at 4% by the end of the year and 9% in the worst case scenario. So inflation is to stay with us for quite a while.

Exxon Mobil Corp

XOM

Portfolio Weight: 9,9%

GIC Group: Energy

Walmart Inc

WMT

Portfolio Weight: 8,4%

GIC Group: Food & Staples

Chevron Corporation

CVX

Portfolio Weight: 8,0%

GIC Group: Energy

NextEra Energy Inc

NEE

Portfolio Weight: 6,7%

GIC Group: Utilities

JPMorgan Chase

JPM

Portfolio Weight: 6,7%

GIC Group: Banks