In this exclusive clip from Hedgeye’s inaugural Mega Market Trends webcast, Hedgeye CEO Keith McCullough answers a viewer question on how inflation expectations factor into our investing decisions.
McCullough laments that inflation is one of the most underappreciated factors in forecasting the macro environment. Predicting the likely path of inflation is the best guide when investing in Treasury bonds.
“It’s really a travesty that Wall Street, CNBC and the Wall Street Journal has never taught the average, high-net wealth person or the little guy how to reallocate their assets to things like Treasurys,” McCullough explains.
“It’s a sad story in America, because it’s a really easy thing to do. All you really have to do is get the rate of change of inflation right and you’re going to get your asset allocation away from TIPS [treasury inflation-protected securities] into treasury bonds right.”
Watch the full clip above for this important lesson on how to use inflation in your investing strategy.