The argument over inflation has reached fever pitch as investors turn to gold, TIPS and index funds to diversify their portfolios and beat the specter of declining purchasing power. However, if inflation fears are not realized, these three investments still serve as good ways to diversify your portfolio in a difficult economic climate.Gold has historically been one of the investments of choice for people seeking to hedge against the loss of the purchasing power of paper currency. Shares of iShares COMEX Gold Trust (IAU) and SPDR Gold Shares (GLD) represent a direct investment in the price of physical gold bullion, stored in protected locations. These funds do not invest in equity securities or complicated derivatives -- just the real deal. An investment in IAU or GLD also allows investors to take a stake in physical gold without state of the art security and a giant vault.
Diversify to Fight Inflation
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