This past month, the Consumer Price Index recorded its most significant increase in over 40 years. Inflation has been climbing for months on end, with little sign of a peak in view. Supply chain constraints from the pandemic continue to linger, and with the prices of groceries, gas, and more rising out of control – the market has been pricing in a possible recession.
Investors and traders have been forced to switch to a more defensive strategy with their trading portfolio in order to have a chance against inflation. Fortunately, PrimeXBT provides exposure to long and short positions on more than 100 different global markets – and with those tools and instruments, many ways to fight back against inflation.
How Recession Fears Turned The Off The Appetite For Risk
The risk appetite across global markets has turned sharply since the beginning of the year. Fear of a possible recession has taken over. What started as simple supply chain issues turned into global disruption, and as a result, the prices of critical commodities began to skyrocket.
With each Consumer Price Index reveal, the United States Federal Reserve became increasingly pressured to raise interest rates. Finally admitting that inflation wasn’t transitory as expected, the Fed followed through, causing risk assets like stocks and crypto to collapse.
The CPI includes energy, groceries, and other consumer goods. Essentially, the cost of living was rising, and to cope with this, combined with a scurry of profit-taking ahead of what is believed to be a coming recession, crushed these once-thriving markets.
Don’t Fight The Trend; Inflation Sends Stock And Crypto Crashing
Not fighting against the trend is ironically one of the ways to fight back against inflation using PrimeXBT. There is a famous saying that “the trend is your friend.” If the trend is working against your position, find a platform that allows you to take a trade with the current trend.
Leveraged long and short positions from PrimeXBT give traders the total flexibility to make money whichever direction markets are trending. If the trend begins to change, this same versatility allows a trader to build hedge positions and scale in and out of positions while the tide is turning, not when it is already too late.
With access to more than 100 different trading instruments, including stock indices and cryptocurrencies like Bitcoin, Ethereum, and a wide range of altcoins from categories like DeFi or Metaverse, the most attractive opportunities are all under one roof.
Uncorrelated Assets Like Currencies, Energy, And Metals Can Help
Protecting a portfolio doesn’t end with going short or building hedge positions. The most common way to do so involves taking positions in uncorrelated assets. PrimeXBT provides access to less-volatile traditional assets in addition to risk assets like stocks and crypto. Traditional markets include the energy commodities like oil and natural gas, metals like gold and silver, and a wide assortment of forex currencies.
Gold and silver have not performed well with the dollar trending. However, these assets traditionally thrive during periods of high inflation. The safe haven assets could be consolidating ahead of a historic run.
A portfolio long USD on forex pairs is also a way to essentially trade against the entire market. With all assets quoted in USD, the recent run in the Dollar Currency Index (DXY) is largely responsible for the weakness in gold and silver, the selloff in stock and crypto, and the record levels in other world currencies like the yen and the euro.
Find A Correlation With Profits Using Covesting Copy Trading
Perhaps the most profitable way a PrimeXBT trader can give inflation a proper fight is with the Covesting copy trading module, available exclusively at the award-winning margin trading platform as part of an ongoing B2B partnership with a European fintech dev named Covesting.
The Covesting copy trading module is a peer-to-peer trading community filled with hundreds of skilled traders who sign up to become strategy managers and increase their income levels. In exchange for having their performance tracked within a fully transparent leaderboard system, these traders will earn a cut from their followers’ copied trades.
Followers use the performance information to choose who to follow and put capital behind, and once following, the system will automatically copy the trades of the strategy managers followed. Followers can bolster their portfolio by following several skilled strategy managers who rank highly in the Covesting leaderboards.
Yield Accounts, Other Ways To Earn Income During Hard Times
Whether it is extra income as a strategy manager or following traders who have in the past earned as much as 90,000% ROI, Covesting provides a unique way to get positioned in the market while things are incredibly volatile.
Traders can also earn extra income through PrimeXBT’s four-level referral system. By using an easily-shareable referral URL, each user referred will generate up to a 20% commission. In addition, any users the referred user brings in will earn a commission for up to four levels of incoming-generating commissions across your associated network.
There are also ways to earn passively, using Covesting yield accounts. Yield accounts offer a variable APY interest rate on staking idle crypto assets using PrimeXBT. From within the PrimeXBT account dashboard, users can connect to top DeFi protocols and earn up to a 14% APY.
Always Use Protection: Fight Inflation With PrimeXBT
Inflation can be harmful to even the most well-thought-out investment and trading portfolios. The missing ingredient is often the fact that the trader doesn’t have access to the professional tools they need to properly manage positions across their portfolio.
A properly built and inflation-resistant portfolio will focus on short positions in risk assets while leaving opportunities for long orders open. It will also include exposure to safe haven assets, the energy sector, and currencies.
With more than 100 different trading instruments and the complete flexibility of leveraged long and short positions, PrimeXBT is the ideal solution to fortifying a portfolio to survive and even fight back against soaring consumer inflation.