Ask HN: How do you hedge against inflation? • Hacker News Board

Re: Ask HN: How do you hedge against inflation?

#11

Post by HWR_14 » Tue, Apr 12, 2022, 9:43 PM UTC

davidito wrote: post #5

An individual can buy up to $10,000 in Series I bonds from the U.S. Treasury a year. Their current ARR is 7.12%. That rate expires at the end of the month (April 2022). https://www.treasurydirect.gov/indiv/research/indepth/ibonds...

Do you know what % of that is fixed vs. the inflation adjusted rate? Also, I was confused by how often the inflation rate adjusts the interest rate.

Re: Ask HN: How do you hedge against inflation?

#12

Post by HWR_14 » Tue, Apr 12, 2022, 9:45 PM UTC

999900000999 wrote: post #7

Is anyone not losing money right now ? I checked one of my 401ks, and I'm down like 5% this year. Checked some other funds and everything has lost money. Previously I wanted to buy a home, but I also hate the notion of being trapped in one place

Well, I know a few people who went into inverse index funds (those that move opposite of an index fund) in 2020, thinking that there would be a COVID recession. They were too disgusted to pull that money out, so they're up on the year, but still down since 2020.

Re: Ask HN: How do you hedge against inflation?

#13

Post by loeg » Wed, Apr 13, 2022, 5:18 AM UTC

davidito wrote: post #5

An individual can buy up to $10,000 in Series I bonds from the U.S. Treasury a year. Their current ARR is 7.12%. That rate expires at the end of the month (April 2022). https://www.treasurydirect.gov/indiv/research/indepth/ibonds...

Actually, $15,000/year -- you can buy an additional $5,000 in paper I-bonds with your federal tax refund, and you can arbitrarily overfund your tax payment to be sure to have $5,000 in refund. The paper bonds can be exchanged for electronic I-bonds through a somewhat annoying process.

Re: Ask HN: How do you hedge against inflation?

#14

Post by loeg » Wed, Apr 13, 2022, 5:23 AM UTC

HWR_14 wrote: post #11

davidito wrote: post #5

An individual can buy up to $10,000 in Series I bonds from the U.S. Treasury a year. Their current ARR is 7.12%. That rate expires at the end of the month (April 2022). https://www.treasurydirect.gov/indiv/research/indepth/ibonds...

Do you know what % of that is fixed vs. the inflation adjusted rate? Also, I was confused by how often the inflation rate adjusts the interest rate.

The fixed rate is 0.00% -- it's all inflation rate. Inflation rate is adjusted every six months.

Here are past fixed rates going back to 1998: https://www.treasurydirect.gov/indiv/research/indepth/ibonds... It hasn't been much above 0% since 2008.

Re: Ask HN: How do you hedge against inflation?

#15

Post by gdfgjhs » Wed, Apr 13, 2022, 3:20 PM UTC

davidito wrote: post #5

An individual can buy up to $10,000 in Series I bonds from the U.S. Treasury a year. Their current ARR is 7.12%. That rate expires at the end of the month (April 2022). https://www.treasurydirect.gov/indiv/research/indepth/ibonds...

Do you really need to buy these bonds with payroll deduction?

Re: Ask HN: How do you hedge against inflation?

#16

Post by loeg » Thu, Apr 14, 2022, 3:39 AM UTC

gdfgjhs wrote: post #15

davidito wrote: post #5

An individual can buy up to $10,000 in Series I bonds from the U.S. Treasury a year. Their current ARR is 7.12%. That rate expires at the end of the month (April 2022). https://www.treasurydirect.gov/indiv/research/indepth/ibonds...

Do you really need to buy these bonds with payroll deduction?

No.