Best of the financial columnists

What’s worse than inflation?

Marcus Ashworth and Stuart Trow

Bloomberg

Trustees of pension funds tend to be cautious, but their “over-reliance” on inflation-linked bonds in recent years has left them “recklessly overexposed”, say Marcus Ashworth and Stuart Trow. These securities, known as linkers, have become “increasingly popular as hedging instruments”. Unfortunately, they have performed “worse than the risks they were supposed to counterbalance”. In the past six months, as inflation has surged (the very time they should outperform regular bonds), the value of the