Three Stocks Linked to Inflation Hedge Strategies Amid Rising Rates

The increasing U.S. debt, persistently high interest rates, and potential inflation concerns are making the cost of capital a critical factor in investment portfolios. Investors who overlook this aspect may experience diminishing real returns. Those who focus on these realities can explore companies utilizing inflation-linked strategies. This article highlights three stocks identified through an inflation-focused screener that are particularly relevant in this economic context. Additionally, the full screener revealed 23 more asset managers and ETF providers with detailed narratives not covered here.

Cohen & Steers (CNS) is a New York-based asset manager specializing in global real assets and alternative income tailored for institutional and individual investors. The company generates approximately $583.9 million in asset management revenue, mainly from North American clients, and has a market capitalization of $3.6 billion. Given the heightened inflation risks and persistent high interest rates, many investors are shifting towards listed real estate and infrastructure, which are the primary focus areas for Cohen & Steers. The company's strategy includes expanding its active ETFs and diversifying its product offerings to attract new investor segments and enhance client retention, potentially supporting growth in assets under management (AUM) and revenue stability. Investors should consider how changes in demand for listed real assets could affect Cohen & Steers' earnings potential.

Apollo Global Management (APO), another key player, is a New York-based alternative asset manager that invests globally in credit, private equity, infrastructure, and real estate. The firm reports around $6.5 billion in revenue from Asset Management, $1.4 billion from Principal Investing, and $25.9 billion from Retirement Services, with a market cap of $70.1 billion. Apollo’s strategy aligns with the inflation-hedging theme by combining long-term infrastructure and real asset financing with credit products aimed at institutions concerned about the implications of inflation and rising interest rates on bond-heavy portfolios.