Types of Bonds

Bonds can play a vital role in your investment or retirement portfolio. Bonds yield income, are often considered less risky than stocks and can help diversify your portfolio.  ~ BlackRock

Bonds – also known as fixed income instruments – are used by governments or companies to raise capital by borrowing from investors. Bonds are typically issued to raise funds for specific projects. In return, the bond issuer promises to pay back the investment, with interest, over a certain period of time.

Certain types of bonds – corporate and government bonds – are rated by credit agencies to help determine the quality of those bonds. These ratings are used to help assess the likelihood that investors will be repaid. Typically, bond ratings are grouped into two major categories: investment grade (higher rated) and high yield (lower rated).

The three major types of bonds are corporate, municipal, and Treasury bonds:

  • Corporate bonds are debt instruments issued by a company to raise capital for initiatives like expansion, research and development. The interest you earn from corporate bonds is taxable. But corporate bonds usually offer higher yields than government or municipal bonds to offset this disadvantage.
  • Municipal bonds are issued by a city, town or state to raise money for public projects such as schools, roads and hospitals. Unlike corporate bonds, the interest you earn from municipal bonds is tax-free. There are two types of municipal bonds: general obligation and revenue.
    • Municipalities use general obligation bonds to fund projects that don’t produce income, such as playgrounds and parks. Because general obligation bonds are backed by the full faith and credit of the issuing municipality, the issuer can take whatever measures necessary to guarantee payments on the bonds, such as raising taxes. 
    • Revenue bonds, on the other hand, pay back investors with the income they’re expected to create. For example, if a state issues revenue bonds to finance a new highway, it would use the funds generated by tolls to pay bondholders. Both general obligation and revenue bonds are exempt from federal taxes, and local municipal bonds are often exempt from state and local taxes as well. Revenue bonds a good way to invest in a community while generating interest.
  • Treasury bonds (also known as T-bonds) are issued by the U.S. government. Since they’re backed by the full faith and credit of the U.S. government, treasury bonds are considered risk-free. But treasury bonds don’t yield interest rates as high as corporate bonds. While treasury bonds are subject to federal tax, they’re exempt from state and local taxes.
  • Bond funds are mutual funds that typically invest in a variety of bonds, such as corporate, municipal, Treasury, or junk bonds. Bond funds usually pay higher interest rates than bank accounts, money market accounts or certificates of deposit. For a low investment minimum ranging from a few hundred to a few thousand dollars, bond funds allow you to invest in a whole range of bonds, managed by professional money managers. When investing in bond funds, keep in mind:Bond funds usually include higher management fees and commissions
  • Junk bonds are a type of high-yield corporate bond that are rated below investment grade. While these bonds offer higher yields, junk bonds are named because of their higher default risk compared to investment grade bonds. Investors with a lower tolerance for risk may want to avoid investing in junk bonds.

Bonds are an investment approach focused on preservation of capital and the generation of income. It typically includes investments like government and corporate bonds. Fixed income can, such as bonds, offer a steady stream of income with less risk than stocks.


References:

  1. https://www.blackrock.com/us/individual/education/how-to-invest-in-bonds

Duration Risk…What Does It Mean

Duration is a measure of the sensitivity of the price of a bond to a change in interest rates.  Interest rate changes can affect the value of a bank or financial institution’s fixed income (bond) holdings. How a bond or bond portfolio’s value is likely to be impacted by rising or falling interest rates is best measured by duration.  ~ PIMCO

Duration is a measurement of a bond’s interest rate risk that considers a bond’s maturity, yield, coupon and call features. These many factors are calculated into one number that measures how sensitive a bond’s value may be to interest rate changes.

Interest rates may change after you invest in a bond and interest rate changes have a significant impact on bond values. Say you invest in a bond at 5% interest. If interest rates increase by 1%, additional investors in the same bond will now demand a 6% rate of return. Because the bond interest payments are fixed each year, the market price of the bond will decrease to increase the rate of return from 5% to 6%.

The key point to understanding how interest rates and bond prices are related.  It’s important to remember that interest rates and bond prices move in opposite directions. When interest rates rise, prices of traditional bonds fall, and vice versa. So if you own a bond that is paying a 3% interest rate (in other words, yielding 3%) and rates rise, that 3% yield doesn’t look as attractive. It’s lost some appeal (and value) in the marketplace.

Duration is measured in years. Generally, the higher the duration of a bond or a bond fund (meaning the longer you need to wait for the payment of coupons and return of principal), the more its price will drop as interest rates rise.

Duration risk, also known as interest rate risk, is the possibility that changes in borrowing rates (i.e. interest rates) or the Federal Reserve fund rate may reduce or increase the market value of a fixed-income investment.

Generally, the higher a bond’s duration, the more its value will fall as interest rates rise, because when rates go up, bond values fall and vice versa.

If an investor expects interest rates to fall during the course of the time the bond is held, a bond with a longer duration would be appealing because the bond’s value would increase more than comparable bonds with shorter durations.

As you might conclude, the shorter a bond’s duration, the less volatile it is likely to be. For example, a bond with a one-year duration would only lose 1% in value if rates were to rise by 1%. In contrast, a bond with a duration of 10 years would lose 10% if rates were to rise by that same 1%. Conversely, if rates fell by 1%, bonds with a longer duration would gain more while those with a shorter duration would gain less.

% Change in bond prices if rates spike 1%
Hypothetical illustration of the effects of duration, exclusively on bond prices

In summary, bond duration measures the interest rate risk. It is a measure of the change in bond prices due to a change in interest rate. Duration is measured in years. The higher the duration of the bond, the more will be the price drop as interest rates increase. This is because one needs to wait longer to get their coupon payments and principal amount back.

Bond duration is important as it helps in measuring the sensitivity of a bond’s price to interest rates. If the interest rates were to fall by 1% and bond duration is three years, then the price will increase by 3%. This knowledge will help you understand the effect on interest rate changes on the portfolio returns.


References:

  1. https://www.pimco.co.uk/en-gb/resources/education/understanding-duration 
  2. https://scripbox.com/mf/bond-duration/https://scripbox.com/mf/bond-duration/
  3. https://www.blackrock.com/us/individual/education/understanding-duration

Interest Rates, Cost of Capital and Recession

Interest rates are often called the price of money. They determine how expensive capital is to access for companies, but also for individuals and even governments. ~ Jonathan Schramm

The Federal Reserve controls what is called the federal funds rate, which is the rate banks pay to borrow from other banks. Other interest rates throughout the system are based on that rate.

When an economy is in recession or unemployment is high, the Fed lowers rates. This is meant to encourage investment and spending, pushing more money into the economy.

Inflation is a sign there is too much money in the financial system and economy. One way to reduce the monetary supply is to give people and businesses an incentive to take on less debt. A good way to do that is to raise rates. And this is just what the Federal Reserve is doing.

Interest rates affect stocks in two main ways: the impact companies’ bottom line and impact investor’s behavior.

Many companies “roll over” their debt. This means they never really pay their debt, just pay the interest and renew their old bonds with new ones. In this case, rising rates mean the new bonds will cost the company a lot more in interest expenses going forward.

Some companies are also highly reliant on cheap debt to keep afloat or grow. Others rely on customers spending on credit cards. These companies’ profits might suffer in an environment of rising rates.

This is why a rising rate environment favors skilled stock pickers. A solid balance sheet, low debt, cheap valuation, or high profitability will be very valuable in an environment of rising rates.

Higher interest rates are a disincentive for investors to plow borrowed money into asset markets. That’s one of the main reasons why stocks, cryptocurrencies, and other assets crashed in 2022.

Rising rates for borrowed money tends to cause capital flow out of markets, depressing the values of even quality companies. That hurts investors who bought at the top, especially if they bought at the top with borrowed money. For others it creates a valuable entry point.

Overall, rising interests rates and tightening the money supply are a useful tool to help bring inflation under control. But the recent interest rate increase might not have been enough and there’s probably more to come. If inflation stays high, we would need rates continue to rise to curb inflation.

The positive aspects for US investors:

  • Rising rates support a stronger dollar.
  • A strong dollar makes US imports cheaper.
  • A strong dollar support consumers’ spending by decreasing import costs.
  • Rising rates might help to keep inflation under control.

The negative aspects for US investors:

  • Currency devaluation can hurt overseas investments measured in USD.
    Overindebted companies and consumers might not be able to manage higher rates.
  • Rising rates decrease demand for big-ticket items like homes and vehicles.
  • Rising rates increase the risk of a recession.
  • Rising rates make US exporters less competitive.
  • Rising rates restrict the use of borrowed money by investors, decreasing demand for assets across the board.vehicles.
  • Rising rates increase the risk of a recession.
  • Rising rates make US exporters less competitive.
  • Rising rates restrict the use of borrowed money by investors, decreasing demand for assets across the board.

References:

  1. https://finmasters.com/rising-interest-rates-effects/

The Impact of Increasing Interest Rates on the Economy and Investing

The Federal Reserve Bank (Fed) implements monetary policy that has a broad impact on the US economy. One of the ways the Fed impacts its dual mandate of managing unemployment and inflation is to periodically raise or lower interest rates.

The Federal Reserve in November 2022 raised interest rates by three-quarters of a percentage point — or 75 basis points — for the fourth time in the calendar year, bringing its key benchmark borrowing rate that rules all other interest rates in the economy up to a target range of 3.75-5 percent, where it hasn’t been since early 2008, according to a Bankrate.

The fed funds rate matters because it has ripple effects on every aspect of consumers’ financial lives, from how much they’re charged to borrow to how much they earn in interest when they save. And, changing interest rates is one of the main tools that the Fed can use to cool down inflation.  

Inflation is the increase in the prices of goods and services over time and occurs when the demand for those goods and services exceeds supply. Inflation also represents a loss of purchasing power.

Typically, the Fed raises interest rates in times of economic expansion and does so to prevent the economy from overheating. The opposite is true when interest rates are cut, which typically occurs when the economy is in a down trend. 

To raise interest rates, the Fed changes the overnight rates at which it lends money to banks. That sets off a chain reaction that impacts the rates banks charge to businesses and individuals. When rates rise, the impact on the economy includes:

  • Borrowing costs rise for businesses, which can reduce investments in new plants, equipment, marketing, and physical expansion.
  • Borrowing costs rise for consumers, which reduces consumer spending, home buying, and investing.
  • Savings accounts and other low-risk investments earn more interest, making investing in low-risk instruments more attractive.

Markets adjust, with fixed income securities generally reducing in value and equities reacting in a mixed fashion depending on how much a rate rise is expected to affect specific types of businesses.

The U.S. Interest Rate Historical Timeline

The chart below shows the history of Fed Funds Rates going back to 1954.

The U.S. Interest Rate Historical Timeline The chart below shows the history of Fed Funds Rates going back to 1954.

Chart of Fed Funds Rate (Macrotrends)

Rising interest rates impact investing in several ways, some of which are fundamental and some of which are perceptual.

Adding to the dilemma for many investors is the inflation outlook and the question of how transitory or persistent that inflation will be. From a rate perspective alone, rising rates can be expected to have the following impact:

  • Prices of bonds and other fixed-income investments will weaken with rising rates, especially the longer-term instruments.
  • Rates offered on new bonds will rise, making them somewhat more competitive with equities.
  • Rates should rise in bank products such as CDs, bringing them back on the radar for investors.
  • When rates rise, stocks tend to fall — when rates fall, stocks rise.

Equity market reactions will be mixed, depending on the effects of higher rates on different companies and industries. Companies that are more leveraged will incur higher costs. Companies with high-ticket products that rely on consumer credit may weaken. On the whole, rising rates should also dampen enthusiasm to speculate, given higher borrowing costs.

“When interest rates are low, companies can assume debt at a low cost, which they may use to add team members or expand into new ventures,” says Brenton Harrison, CFP® professional based in Nashville, TN. “When rates rise, it’s harder for companies to borrow and more costly to manage what debt they already have, which impacts their ability to grow,” he adds. These higher costs may result in lower revenues, thus negatively impacting the value of the company.

Also keep in mind that as rates fall on savings accounts and certificates of deposit, investors generally seek out higher paying investments like stocks and are generally seen as a catalyst for growth in the market; in a rising rate environment investors tend to shift away from stock to places with less risk and safer returns. 

The specter of rising rates can also change the behavior of investors, many of whom may decide to put off purchases on credit or sell stocks that were purchased on margin, based more on their expectations than on near-term reality.

“Central banks tend to focus on fighting the last war,” says Scott Sumner, monetary policy chair at George Mason University’s Mercatus Center. “If you have a lot of inflation, you get a more hawkish stance. If you’ve undershot your inflation target, then the Fed thinks, ‘Well, maybe we should’ve been more expansionary.’”


References:

  1. https://seekingalpha.com/article/4503025-federal-reserve-interest-rate-history
  2. https://www.bankrate.com/banking/federal-reserve/history-of-federal-funds-rate/
  3. https://www.businessinsider.com/personal-finance/how-do-interest-rates-affect-the-stock-market

Monetary Tightening

“We have overstimulated the economy by a big factor” ~ Sam Zell

Billionaire investor Sam Zell told CNBC Squawk Box that he sees no reason to be optimistic that there won’t be further severe economic (recession) and market (bear market) pains. “We have overstimulated the economy by a big factor,” Zell remarked. “We have to take the punch bowl away.”

He thinks a liquidity crisis may be up next and believed the whole “inflation is transitory” political soundbite originating from the Federal Reserve and the Biden Administration several months ago was an embarrassment and the phrase should be relegated to the dust bin of history.

Free money–monetary quantitative easing and historically low interest rates–leads to excess which leads to recession, states Zell. It’s really that simple.

Markets will not bottom until all that excess loose money bleeds out of the economy and Fed tightens its monetary policy. The pain of recession and further market decline are needed and will be good for long term markets.

The Federal Reserve maintained a too loose and easy monetary policy for too long.

“If you get really good at what you do, you get the freedom to be who you really are.” ~ Sam Zell


References:

  1. https://www.costar.com/article/1152237605/real-estate-magnate-sam-zell-moonlights-as-economist
  2. https://www.agriculture.com/news/business/risk-and-reward-a-conversation-with-sam-zell

Sam Zell, founder and chairman of Agricultural Real Estate, used to joke that his father made a life-or-death decision when he was 34 years old, and then never made another mistake again. Zell was inspired by his father’s confidence.

Dividend Growth Stocks

Dividend-growth stocks typically exhibit stable earnings, solid fundamentals and strong histories of profit and growth.

Dividend Growth companies are companies that have consistently grown their dividends over the long-term, such as for at least 15 consecutive years. According to ProShares, these companies generally come with attributes of quality that investors have come to expect:

  • Durable competitive advantages, solid fundamentals, and management teams that are committed to returning capital to shareholders.
  • Higher gross and net profit margins than the broader index, with more consistent levels of earnings growth through the market’s ups and downs.
  • Lower levels of debt than companies in the broader market index.

Dividend growers have also demonstrated a history of weathering market turbulence over time. They’ve done so by delivering most of the market’s upside in rising markets with considerably less of the downside in falling ones—a valuable feature in times of uncertainty.

“Dividend growth stocks have outperformed in various market environments,” according to global investment management firm Nuveen. “Dividend growth stocks have provided an attractive combination of earnings and cash flow growth potential, healthy balance sheets and sustainable dividend policies. These stocks have historically offered compelling performance during up markets and provided a buffer during market drawdowns and in volatile environments.”

When the Federal Reserve shifts from an accommodative monetary easing policy to a restrictive monetary policy, there is often an initial period of market volatility and uncertainty.

Dividend growth has been a desirable trait for equities immediately before, during, and after past cycles of less accommodative Fed policy.

Many investing gurus recommend strong dividend payers as the way to weather dual challenges of inflation and recession, noting that the dividend stocks’ income streams are capable of offsetting inflation – even when inflation is running higher than 8%.

“Dividend growth is one of the few things that has kept up with inflation as you go back and look over the decades. So when you go back and you look at the ’70s, ’80s — which is the last time you can actually find any notable inflation — what you see is dividend growth pretty much kept pace with it,” explained Sharon Hill, the co-leader of Vanguard’s Equity Income Fund.

With the three challenges facing investors today—rising interest rates, slowing economic growth and income scarcity–dividend growth stocks could make a better choice for the current economic and market environment.

Source: ProShares, Bloomberg. Data from 12/31/05 to 12/31/21. Past performance does not guarantee future results. Index calculations do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged, and one cannot invest in an index.

High-quality companies that have consistently grown their dividends tend to have stable earnings, solid fundamentals and strong histories of profit and growth. As a result, they have been generally better positioned to weather potentially slowing growth.


References:

  1. https://finance.yahoo.com/news/investing-whiz-sharon-hill-says-155244449.html
  2. https://www.fidelity.com/insights/investing-ideas/10-dividend-growth-stocks
  3. https://www.proshares.com/browse-all-insights/insights/three-reasons-dividend-growth-may-be-the-right-approach
  4. https://www.proshares.com/browse-all-insights/insights/why-dividend-growth-mid-caps-may-belong-in-your-portfolio

Inflation Remains at Four Decade High in August

Inflation, which is a loss of purchasing power, is likely to stay elevated thanks to a variety of structural forces.

The Labor Department reported an 8.3% year-over-year increase in the total Consumer Price Index (CPI) for August. It was a bigger gain in inflation, which is a loss of purchasing power, than expected. Economists and financial strategists agreed that the latest data show inflation is sticky.

Sticky inflation is underlying inflation, or inflation in areas where prices tend to change relatively slowly. Additionally, inflation is structural, meaning the floor is higher than many might assume, and the potential implications go beyond recession.

Vincent Deluard, director of global macro strategy at StoneX Financial, says the current period of inflation is the result of three shortages: labor, energy, and trust.

  • Labor. The U.S. labor market is still about seven million workers short of pre-pandemic levels.
  • Energy. The transition to green energy requires moving down the energy-density ladder for the first time in history, meaning the green transition will consume more resources for similar output. And, when withdraws from the strategic petroleum reserve (SPR) stops, it will remove a downward force on oil prices.
  • Trust. Inflation is inversely proportional to the level of trust between a country’s citizens. “Inflation is a fever that tells you an economy has an underlying ailment of weakening trust, then the fever weakens the body, and it all worsens,” opined Deluard. Inflation is “always and everywhere a psychological phenomenon,” where the problem worsens the longer it persists, Deluard states, as he modifies Milton Friedman’s take on inflation.

Additionally, the August’s CPI report puts the “peak inflation” assumption into question and shows that the labor market and demand -– not supply — problems are driving price increases.

More volatile inflation in categories such as food and energy, which economists and policy makers back out of inflation readings to get to what they call core inflation.

The Fed’s attempt to front-load interest-rate increases is one attempt to regain public trust and restore price stability. The “transitory” inflation argument that has been retired in speeches but not in spirit.

Investors, and central bankers themselves, may therefore be underestimating what the Fed must do to curb inflation, while simultaneously underestimating the odds that inflation remains well above 2% for longer.


References:

  1. https://www.barrons.com/articles/inflation-cpi-labor-shortage-energy-prices-51660265410
  2. https://www.barrons.com/articles/cpi-inflation-report-july-2022-data-51660078098?mod=article_inline

Consumers Falling Behind on Monthly Payments

AT&T announced that “more of its customers are starting to fall behind on their bills, a sign that rising costs are pinching many households even for services most Americans consider essential,” writes Drew Fitzgerald in The Wall Street Journal.

The company executives reported that subscribers were paying their monthly phone and internet bills on average two days later than a year ago.

Rising interest rates and higher prices on everything from groceries to gasoline this year due to decades high inflation have pressured consumer sentiment. “When you have 9% inflation, it tends to hit those in the low end of the market really, really hard,” said John Stankey, AT&T Chairman and CEO.

Dividend payout ratio matters

The dividend payout ratio is the amount of dividends paid to shareholders in relation to the total amount of free cash flow the company generates. In other words, the dividend payout ratio measures the percentage of free cash flow that is distributed to shareholders in the form of dividends.

AT&T’s current dividend commitment is for around $8 billion annually, or $2 billion a quarter. The company generated $1.4 billion in free cash flow in the second quarter, far short of the $4.7 billion that analysts were expecting. It means that AT&T’s free cash flow for the quarter didn’t cover its dividend commitment in the period.


References:

  1. Drew Fitzgerald, AT&T Says Customers Fall Behind, The Wall Street Journal, July 22, 2022, pp. B1-B2.
  2. https://www.barrons.com/articles/att-stock-dividend-yield-earnings-51658426833

Inflation and Time Value of Money

As time passes, the value of money declines.

Consumer-price inflation rose to 8.6% in May, its highest in forty years. This tax on households and businesses threatens the overall health of the U.S. economy. Deficit fiscal spending and supply shocks and Russian invasion are the primary causes of the current historic inflation.

Inflation is defined as the decline of purchasing power of the U.S. Dollar over a certain period of time. Inflation is usually expressed as the change in prices over a one-year period.

Purchasing power means how much your money can buy—its “buying power.” You lose purchasing power when prices go up (inflation) and gain purchasing power when prices go down (deflation). Inflation changes the value of a currency over time.

Inflation, risk and opportunity cost together reduce the value of the dollar as time passes. And, when inflation increases, the purchasing power of the U.S. Dollar decreases.

Inflation is rampant, the Federal Reserve seems poised to raise interest rates even higher than previously expected, financial markets are free falling, and there are fears of recession in the air. All this signals economic pain ahead for Americans.

A recession is my no means certain, with a strong jobs market and consumers still flush from pandemic fiscal government handouts. But inflation is sapping consumer and business confidence.

A tax increase would reduce investment and further restrict supply, which would arguably increase inflation.

Inflation is a cost spread over every American. Unemployment, a byproduct of a recession, lands especially hard on specific Americans and American families. Thus, it natural for economists to accept a little more inflation to protect employment and strive for a soft landing.

Blossoming federal role in directly supporting the consumption of a vast number of Americans is a primary driver of fiscal deficits and persistent inflation.

  • 75 million receive a combination of Medicare, Medicaid and Social Security
  • 98 million receive veteran and retired federal government benefits, college aid, rental assistance, Obamacare, food stamps, etc.

These transfers are financed by chronic fiscal deficits. To remedy the problem, politicians would face the career ending choice of benefit cuts, tax hikes or increase borrowing regardless of the worsening effect in inflation.

If prompt and effective actions are not pursued by the Federal Reserve and Administration, the nation may revisit the Stagflation of the 1970s which persisted more than a decade with great consequences to society and the economy.


References:

  1. https://debtinflation.com/how-does-inflation-impact-purchasing-power/
  2. https://www.acorns.com/money-basics/the-economy/what-is-purchasing-power-and-how-does-inflation-affect-it-/

Protect Yourself Against Inflation

“Rising costs can erode your purchasing power if you aren’t careful.” Fidelity Investments

Adding certain asset classes, such as commodities or real estate, to a well-diversified portfolio of stocks and bonds can help buffer against inflation, according to Fidelity Investments.

The last 12 months have seen the highest increases in the consumer price index (CPI) and producer prices (PPI) in decades, and many investors are concerned about the impact that inflation might have on their ability to reach their financial goals.

A trip to the supermarket or your local restaurant brings home the reality of inflation.

The consumer price index (CPI) has risen 8.5% over the last 12 months. Meanwhile, producer prices (PPI) have jumped by 11.2%. Those are the highest rates since the 1970s. And the forces driving prices up such as war, the pandemic, supply chain disruptions, and surging demand from consumers and businesses don’t look to be going away anytime soon.

While it may not be possible to avoid or eliminate the effects of inflation completely, there are actions you may be able to do to reduce its sting.

Add inflation-resistant assets

Though the rise in inflation may be troubling, investors who already have a well-diversified portfolio of traditional stocks and bonds may already have some degree of protection, as portfolios such as these have historically tended to grow even in periods of high inflation. “We still believe that a mix of stocks and bonds can help investors experience growth while managing risk,” says Naveen Malwal, an institutional portfolio manager with Strategic Advisers, LLC.

Source: Bloomberg Finance, L.P.

Malwal recommend specific steps to help provide additional inflation protection. They emphasize that certain investments that have historically done well in inflationary environments. This has included adding diversified commodities, such as energy, industrial metals, precious metals, and agricultural products, as well as real estate stocks and international stocks.

In the bond market, Malwal notes a greater emphasis on high-yield bonds. “While these carry more risk than investment-grade debt, the higher yield may allow them to more easily withstand any increases in interest rates that might occur in response to rising inflation.” He also highlighted a greater exposure to Treasury Inflation-Protected Securities (TIPS), which are designed to help protect investors from the impact of inflation.

Lastly, short-term bonds have typically experienced less volatility during periods of higher inflation. “We generally have more exposure to short-term bonds than to intermediate-term bonds in client accounts,” says Malwal, “But we also have more exposure to long-term bonds, as they have historically provided stability within well-diversified portfolios during periods of stock market volatility.”


References:

  1. https://www.fidelity.com/learning-center/wealth-management-insights/6-ways-to-help-protect-against-inflationhttps://www.fidelity.com/learning-center/wealth-management-insights/6-ways-to-help-protect-against-inflation
  2. https://www.fidelity.com/learning-center/trading-investing/markets-sectors/peak-inflation