Torsten Asmus
The iShares TIPS Bond ETF (NYSEARCA:TIP) has mounted a strong recovery over the past few months as bond yields have moved sharply lower. This has outweighed the impact of lower inflation expectations, which typically act as a drag
TIP: The Inflation Fight Is Not Over Yet
Summary
- The iShares TIPS Bond ETF has seen a strong recovery in recent months as bond yields have fallen more than inflation expectations.
- Inflation expectations have fallen to near two-year lows despite surging risk appetite, creating an opportunity for investors to gain exposure to a recovery in inflation expectations.
- A potential trigger for a recovery in inflation expectations could be a rebound in oil prices, which are yet to join in the risk rally.
I am a full-time investor and owner of Icon Economics - a macro research company focussed on providing contrarian investment ideas across FX, Equities, and Fixed Income based on Austrian economic theory. Formerly Head of Financial Markets at Fitch Solutions, I have 15 years of experience investing and analysing Asian and Global markets.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of TIP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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