While your net-of-inflation real return ought to be positive, your portfolio allocation should not be distorted when inflation is high. As an illustration, if your appropriate portfolio allocation is 60% equity and 40% debt, it should not be 100% equity when inflation is high. It is generally agreed that for retired senior citizens, equity allocation should be on the lower side. If you increase the equity allocation in your portfolio just to beat inflation, it may not suit your risk profile. What does the consumer price inflation basket in India comprise?

Source: The Hindu July 25, 2021 17:03 UTC