Shipping Container Investments Can Protect Against Inflation

When planning and managing your investments, inflation is an influential economic factor that you must take into consideration, and carefully plan for.

Inflation is the rate at which prices for goods and services is rising. For example, if you invest in a stock that provides a 5% return, but inflation is 6%, you are actually losing buying power.

Over time the price of buying things, from a loaf of bread to a new home, often rise. When these increases become excessive, your purchasing power will decline rapidly. This presents challenges for consumers and investors.

When it comes to protecting your investment portfolio from the adverse affects of inflation, there are a few strategies you can adopt to avoid unnecessary hardship; one of which is investing in containers.

In addition to generating income, shipping containers provide diversification too. The container shipping industry gives investors access to countries that may not be experiencing inflation. Diversifying in assets that work abroad, such as shipping containers in emerging markets, provide protection for your portfolio by operating outside the perils of the domestic economy.

Like other commodities, such as real estate investments, the value of container investments tend to rise when inflation is rising, and therefore provide protection against the decreased value of a currency.

rising inflation investing quote

“Inflation is going to be something that may gradually affect your portfolio. Whether that effect is positive or negative depends on the actions you begin to take. You want to be diligent about your investments knowing that change is afoot.” – Craig J. Ferrantino, President of Craig James Financial Services.

Economists agree that inflation is an economic phenomenon that you can expect, with near certainty, will occur at some point in time in your investing career. So, it’s important for you to understand how to invest and plan in such a way that your assets maintain their purchasing power. Consider this … placing money in a saving account will cause a major loss in purchasing power by retirement. Hypothetically, earning 4% in a savings account while inflation grows at 7% makes you feel 4% richer, when in fact you are 3% poorer.

Shipping Operates Independently of Traditional Investments

The financial turmoil in Chinese stock markets is a reminder that traditional investments, like stocks, are a very risky investment. Investors are (again) getting the opportunity to see first-hand the influence that politics and corporate officers can have on their portfolio’s performance; as though anyone would need a reminder of the global financial crisis less than a decade ago.

2008 gfc tina brown vampire squid quote

The 2008 financial crisis is usually attributed to vampire squid greed. There was certainly a lot of that. – Tina Brown

In the absence of appealing alternative investments that operate independently of traditional markets, an investor is at the mercy of international economic and business affairs that are well-beyond their control. Without the diversification offered by investment alternatives like an investment in containers, an investor’s wealth can disappear quickly and without warning; or even the opportunity to react. When a domestic or foreign market drops suddenly, most investors with portfolios that are heavy with traditional investments are left helpless.

financial crisis professional investor good amateur bad

A financial crisis is a great time for professional investors and a horrible time for average ones. – Robert Kiyosaki

When it comes to embracing nontraditional investments, the greatest challenge for many investors is overcoming the fear of the unknown. The fear of not knowing whether an investment is a scam or not. In order for investment-seekers to gain the confidence they need to pursue these new offerings, it is important for them to conduct in-depth investment research in an effort to understand and appreciate the the well-established alternatives available.

financial crisis transparency disclosure jack reed quote

The financial crisis is a stark reminder that transparency and disclosure are essential in today’s marketplace. – Jack Reed

With the increasing political turmoil, corporate greed, and uncertainty in traditional assets across the globe, it will take less time for investors to overcome any apprehensions about alternative investments, and reassess their position on the performance of their existing assets. The growing evidence that traditional investments hold the greater risk will present a very compelling argument for a nontraditional, alternative approach to investing.