Impact of Inflation on investments


Inflation is a villain to your investments , it is a hidden bug which eats our returns . Before investing we need to understand what is inflation and its impact 

In simple terms inflation reduces purchase power of money . Its a  general trend of price rise in a country. there can be a multiple factors responsible to rise in inflation . 

Inflation can be caused by Deficit financing , over supply of money  and other many factors

How Inflation impacts you and me  ?

With rising prices , as a common man we remain always at the receiving end at the time of high inflation . 

let us understand in simple way 

If you buy a pen worth Rs 10/- last year and same pen costs 11/- today and you lost 1/- to inflation , in same way if your Bank F.D is giving you 6% p.a returns and inflation is 7% then your real returns are minus 1  , however if you have put this money in equity and if it gives 9% then your real returns are 2% post inflation  and this plus 2% will again available for compounding , this is the beauty of compounding.

Always explore investment avenues with possible inflation beating returns like equity & gold . Investing in a staggered manner help investor in yielding better returns.


reach us on pcswealthadvisers@gmail.com

PCS CAPITAL were first generation entrepreneurs in financial services . It was formed with foundation stone for creating long-term wealth for the investors through various financial products like Mutual fund s , Insurance , Fixed deposits and Alternate Asset products . We help you understand your financial objectives and make appropriate plan to realise them with proper risk management. rnYou can leave your contact details for professional help in your investment journey.

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