Alternative Investments/Real Estate: Merk Investments Launches First Stagflation-Themed ETF

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Stagflation is a deadly combination of inflation, slow economic growth, and unemployment.

Merk Investments announced the Merk Stagflation ETF (NYSEARCA: STGF) which focuses on investments that would benefit from stagflation, or a situation comprising high and persistent inflation amidst weak economic growth. These investments are a dynamic basket of inflation hedges in the sectors of real estate, oil, bullion, and Treasury Inflation-Protected Securities (TIPS). (CISION PRWeb)

Merk Stagflation ETF (NYSEARCA: STGF)

The new ETF tracks before fees and expenses, the price and yield performance of the Solactive Stagflation Index (SOLSTAGF). The constituents of this index are the Schwab US TIPS ETF (63%), Invesco DB Oil Fund (14%), Vanguard Real Estate ETF (12%), and VanEck Merk Gold Shares (11%).

The fund is dynamic and systematically reweighted using a proprietary trend-following methodology.

Its expense ratio is 0.45%.

“The Merk Stagflation ETF is designed to provide appreciation potential and inflation-sensitive income in an environment of stagflation like that of the 1970s—characterized by high inflation rates, a bull market in commodities, and rising real estate prices,” explained Axel Merk, President and Chief Investment Officer of Merk Investments. “The strategy holds a basket of exposures across three asset classes: inflation-protected bonds, commodities, and real estate.”

“It is a cost-efficient, one-click inflation hedge ETF, proving exposure to investments that might be a valuable diversifier in a stagflationary environment—while cutting out the headache of rebalancing trades,” Merk added.

Nick Reece, Vice President – Macro Research and Investment Strategy, said: “This is the first stagflation-themed ETF in the market. We think STGF will be embraced by advisors and retail investors concerned about inflation and about the outlook for traditional 60/40 portfolios more broadly—and that might be looking for an alternative to traditional fixed-income allocations.”

Related Story: Allianz’ El-Erian Says Fed Waited Too Long To Recognize Inflation

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