{
  "title": "Inflation Hedging for Long-Term Investors",
  "publication": "IMF Working Papers, April 1, 2009",
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  "summary": "Long-term investors face a common problem-how to maintain the purchasing power of their assets over time and achieve a level of real returns consistent with their investment objectives.",
  "sections": [
    {
      "heading": "Overview and Research Question",
      "content": "- Authors: Shaun K. Roache, Alexander P. Attie\n- Publication date: April 1, 2009\n- Research question: How can long-term investors maintain the purchasing power of their assets over time and achieve a level of real returns consistent with their investment objectives, given limited supply and liquidity of inflation-linked bonds and derivatives?"
    },
    {
      "heading": "Data, Methodology, and Scope",
      "content": "- Model: Vector error correction model\n- Context: Assessment of inflation-hedging properties of traditional asset classes over different time horizons within a diversified portfolio\n- Subjects: Bonds, Currencies, Financial institutions, Financial regulation and supervision, Hedging, Inflation, Money, Prices, Stocks\n- Keywords preserved from source: Bonds, break, Currencies, Diversification, Global, Hedging, impulse response, Inflation, inflation sensitivity, inflation shock, inflation-hedging property, Investments, less-than-full inflation compensation, Portfolio Allocation, spot price, Stocks, total return, WP, yield"
    },
    {
      "heading": "Key Findings",
      "content": "- Effective short-run hedges, such as commodities, may not work over longer horizons.\n- Tactical asset allocation could enhance investment returns following inflation surprises.\n- Investors often continue to rely on indirect hedging properties of traditional asset classes because inflation-linked bonds and derivatives have limited supply and liquidity."
    },
    {
      "heading": "Implications for Long-Term Investors",
      "content": "- Reliance on short-run inflation hedges alone can be inadequate for preserving purchasing power over long horizons.\n- Incorporating tactical asset allocation after inflation surprises can improve investment outcomes.\n- Market limitations in supply and liquidity of inflation-linked instruments necessitate evaluation of traditional asset classes' inflation-hedging properties within a diversified portfolio framework.\n\n---\n\n Content in this bundle\n\n- wp0990\n  - wp0990 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp0990 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/inflation-hedging-for-long-term-investors-22875"
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    "Authors: Shaun K. Roache, Alexander P. Attie",
    "Published: April 1, 2009",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451872378.001",
    "Authors: Shaun K. Roache, Alexander P. Attie",
    "Publication date: April 1, 2009",
    "Research question: How can long-term investors maintain the purchasing power of their assets over time and achieve a level of real returns consistent with their investment objectives, given limited supply and liquidity of inflation-linked bonds and derivatives?",
    "Model: Vector error correction model",
    "Context: Assessment of inflation-hedging properties of traditional asset classes over different time horizons within a diversified portfolio",
    "Subjects: Bonds, Currencies, Financial institutions, Financial regulation and supervision, Hedging, Inflation, Money, Prices, Stocks",
    "Keywords preserved from source: Bonds, break, Currencies, Diversification, Global, Hedging, impulse response, Inflation, inflation sensitivity, inflation shock, inflation-hedging property, Investments, less-than-full inflation compensation, Portfolio Allocation, spot price, Stocks, total return, WP, yield",
    "Effective short-run hedges, such as commodities, may not work over longer horizons.",
    "Tactical asset allocation could enhance investment returns following inflation surprises.",
    "Investors often continue to rely on indirect hedging properties of traditional asset classes because inflation-linked bonds and derivatives have limited supply and liquidity.",
    "Reliance on short-run inflation hedges alone can be inadequate for preserving purchasing power over long horizons.",
    "Incorporating tactical asset allocation after inflation surprises can improve investment outcomes.",
    "Market limitations in supply and liquidity of inflation-linked instruments necessitate evaluation of traditional asset classes' inflation-hedging properties within a diversified portfolio framework.",
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