! Asset Returns During High and Low Inflationary Periods
Craig Israelsen Ph.D., teaches as an executive-in-residence in the Personal Financial Planning Program at Utah Valley University in Orem, Utah. He is also the developer of the 7Twelve Portfolio (www.7twelveportfolio.com) and the author of three books, including “7Twelve: A Diversified Investment Portfolio With a Plan” (John Wiley & Sons, 2010).


Discussion

Craig & Nancy Bell from CA posted 10 months ago:

Dr Israelson did not mention the point which is most important (to me, at least). If I am reading Table 2 correctly, the difference in the average real return is less using the multi-asset portfolio -- meaning you have a smoother ride over time and pretty consistent performance, as compared to the 60-40 portfolio's wider gap in average real returns. If yearly performance is closer to average (less volatility), that would tend to indicate higher terminal values at the end of a lengthy period of time. At least that's how it seems to me.


Bernard Biltek from FL posted 10 months ago:

REITS have been dropping in value whenbinterest rates rise lately. Inflationary times usually have increasing interest rates. Hence I am suprised that REITS are expected to do well.


Dave Gilmer from WA posted 10 months ago:

My only comment on this article has to do with the calendar year bias for the low inflation or high inflation results. Pulling out years like 1986 and putting them into the low inflation list seems a little problematic to me as market returns don't always follow the same calender as inflation. It would have made more sense to me for you to have picked a continuous group of years for the Asset performance.


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