Time for risk-rebalancing as inflation climbs

clock

Elliot Farley, fund manager at T. Bailey, explains how inflation has caused a dynamic shift in what we traditionally perceive to be low-risk assets.

It used to be so simple: “Cash safe; equities risky”. Bonds were somewhere in between; gilts nearer to cash and high yield corporate bonds closer to equities. Picture it like a child’s seesaw with the cash child sitting on one end, bottom comfortably close to the ground, and equities up in the air, legs akimbo looking slightly nervy. But the current combination of low interest rates, escalating taxes and rising inflation has had a dramatic impact – it is like the class heavyweight clambering on board the high end. Our understanding of general risk in the current environment has theref...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Crypto investors receive 40 times more HMRC tax warnings than stock traders

Crypto investors receive 40 times more HMRC tax warnings than stock traders

Data shows enforcement activity shift

clock 19 March 2026 • 2 min read
Wrestling with the idea of a new world order? Try European smaller companies

Wrestling with the idea of a new world order? Try European smaller companies

'Let me try to explain the case for calm'

David Walton
clock 16 March 2026 • 4 min read
Low-cost platforms spur one in three UK adults to invest

Low-cost platforms spur one in three UK adults to invest

Trading 212 the main beneficiary

Michael Nelson
clock 12 March 2026 • 2 min read