How does inflation affect my portfolio?
A market question puts a portfolio next to what the markets did — an index, a sector, a period. The comparison only means anything when both sides are measured over the same dates and in the same currency.
Worked through on a sample portfolio. The figures below are that portfolio’s, not yours.
Inflation affects a portfolio in several ways. Below I describe the main channels and then show which parts of your portfolio are most exposed, using your holdings and allocation.
How inflation matters (brief)
- Purchasing power: Inflation reduces the real value of cash and fixed payments.
- Nominal returns vs real returns: A +X% nominal return is worth less in real terms when inflation is positive.
- Asset behavior: Equities, commodities and some real assets often rise with inflation; cash and some bonds lose real value; crypto and precious metals can show varied correlation.
- Volatility and correlation: Inflation surprises tend to raise volatility and can change which holdings drive portfolio risk.
Your portfolio exposure (table of relevant buckets)
| Asset | Allocation (%) | Value (EUR) | Notes |
|---|---|---|---|
| Stock | 49,09% | 44.670,25 € | Stocks usually have some inflation protection via pricing power |
| ETF | 31,21% | 28.397,93 € | Broad-market ETFs track equities’ inflation sensitivity |
| Crypto | 8,61% | 7.835,60 € | Crypto exposure; historically mixed vs inflation |
| Cash | 6,06% | 5.510,23 € | Cash loses purchasing power when inflation > interest |
| Precious metal | 5,03% | 4.575,79 € | Gold can act as an inflation hedge in some periods |
What in your holdings contributes most to risk if inflation moves
- Your top volatility contributors include Apple Inc. and Microsoft Corp. (large weights and high volatility contribution). These are equity exposures that react to growth and inflation expectations.
- Crypto and Ethereum/Bitcoin are higher-volatility exposures with non-standard inflation correlation (they appear among top volatility contributors).
- Cash (Euros) is 6,06% of your portfolio and will lose real value if inflation outpaces interest.
Headline numbers to keep in mind
- Portfolio value: 90.989,80 €
- Cash: 5.510,23 € (6,06%)
- Total invested (what you put in): 63.990,15 €
- Unrealized gain: +21.489,42 € (+33,58%)
If you want, I can run a simple scenario showing how a uniform inflation shock would change real portfolio value (I will state assumptions clearly).
This page in other languages
Related questions
See this for your own portfolio
The assistant answers the same question about your own holdings, with your figures and today’s prices. Import from your broker, or open the demo portfolio and ask it there.