These undervalued and “inflation-protected” assets could outperform in the fourth quarter

These undervalued and

Investors may be looking for an inflation hedge after better-than-expected consumer price data failed to keep the market afloat on Tuesday.

The Dow Jones Industrial Average, S&P 500 and Nasdaq Composite all closed lower on Tuesday despite the Department of Labor’s consumer price index posting weaker-than-expected growth in August.

New Street Advisors Group CEO and founder Delano Sapporu told CNBC’s “Trading Nation” on Tuesday that the financial sector may offer some protection against a slight rise in inflation, given its largely operating costs. fixed.

His top pick in the space in recent months was JPMorgan for its “excellent loan portfolio”, investment banking savvy and below par valuations.

“He is the world leader in investment banking fees with a 9% portfolio share,” he said. “If you look at what they’ve traded over the past three months as yields have fallen, this could be an opportunity for those investors who preferred that stock to come back at a more favorable price.”

If inflation increases significantly, Sapporu recommends turning to cryptocurrencies as a store of value.

“Cryptocurrency is a great hedge for people,” he said. “It’s something I add to my portfolio for myself and my clients. You are looking at the floor price. We’ve seen some growth since July. [and] Better news flow.

Quint Tatro de Joule Financial favors a more traditional store of value: gold.

“You would think that gold, which has traditionally been a hedge against inflation, would have risen during these unusually high CPI impressions, and that did not happen,” said the chief investment officer of the company in the same interview.

But while some price increases – for example, for automobiles and transportation – are likely to be temporary, the rising costs of everyday goods and services may last longer, Tatro said.

“We don’t see it go away,” he said. “People are going to say, ‘Hey, this is not fleeting. He’s here to stay, ”and eventually the gold will win.

Its main stock recommendation was Newmont Mining, the world’s largest gold mine.

Tatro said, “Newmont has an incredible track record. It really is a proxy for gold. If we’re right, that should go ahead with gold, and we’re paid around 4% for waiting. ”” Company in response to Tuesday’s CPI print.

“I think it would be good,” he said. “You get it at a discount, and I think it will continue to rise with gold if we also see core inflation rise.”

Disclosure: Delano Sapporu is tall Bitcoin And ethereum. Joule Financial owns shares of Newmont Mining.

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