Indian Stock Markets are on a terrific high. However, this is causing anxiety to investors, and they are coming into cash. Now how does one protect the cash from depreciating in value? Are there any rules and past experiences
How does one protect cash from depreciating in value?
Cash depreciates as inflation increases or also relative to another currency. You can protect cash from depreciating by trying to lock in fixed rates of return that are expected to beat inflation, or by investing in currencies that are relatively cheap compared to the indian currency. The later option can be more risky, because you are banking on the foreign currency appreciating.
Reply:The best rule would be to spend it now while it still has value!!
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