These actions that protect portfolios from the harmful effects of inflation

Inflation does not only eat away at household purchasing power. It also eats into their savings. To protect your savings, one of the solutions is to take risks and turn to equities.. In effect, “over time, corporate revenues and profits rise with inflation. Societies naturally adapt to the waltz of prices and wages,” explains John Plassard, investment advisor at Mirabaud. Inflation is a two-step phenomenon: prices rise first, which inflates company incomes, and then wages rise.“Meanwhile, the best-positioned companies, those that can pass on their rising costs to their customers, are managing to increase their margins,” explains an economist.

However, not all companies are in the same boat. They have more or less “pricing power”, that is to say the ability to make their end customers accept increases in their…