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The Alternative Green Energy Thread
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Obviously you can also avoid the inflation risk via index linked gilts but the real returns are very small. Opposite ends of the risk/reward scales.
I think....0 -
Linkers are really only useful in protecting against inflation shocks (i.e, when inflation is unexpectedly much higher than anticipated)
If inflation is very high then both equities and bonds suffer and neither offer investors any downside protection, which is where linkers step in. Personally, I am lucky enough to already have good protection against inflation through final salary pensions and State Pension which are both uncapped, so don't feel the need to hold linkers to protect against unexpectedly high inflation shocks (which do seem to be occurring more frequently lately)
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