E.D.Hart

Looking for an Inflation Linked Parking Spot

Growing your money after subtracting inflation means a net shrinking of your money, hence guaranteed risk. There is no minimized risk--its built in to lose you money.

Looking for an Inflation Linked Parking Spot

The investing speculator is correct: shorting treasuries--if you know what you are doing may be a better bet as there is a massive bubble in treasuries now. They are currently guaranteeing that you will lose money, after inflation, as they carry a negative yield.

You are in effect, paying the government for the right to loan it money.

DrBagel is also correct, the TIPS are not a good vehicle for long term inflation protection because they are linked to flawed US government inflation calculations. If you trust the government to calculate inflation for you, then go for it.

But real inflation is north of 8%. Thus tips will leave you in the hole.

One option that still looks good now is the energy trusts that are linked to oil and natural gas. Three of my favorites are PWE, COSWF, and HGT. The payouts are currently between 10-13%.

True, the new Canadian tax regime will take a bigger bite, but this is more than made up for by the increasing dividends in appreciating currency of the Canadian dollar (except for HGT, which is in US).

Disclosure: I own COSWF and PWE.