UBS Asset, Pictet Seek Out Inflation Safe Havens in Stocks

UBS Asset, Pictet Seek Out Inflation Safe Havens in Stocks

(Bloomberg) -- With the global inflation debate intensifying, equity investors are fine tuning their portfolios to guard against the impact of price pressures.

A preference for companies with the greatest pricing power is one approach adopted by investors from JPMorgan Asset Management to Pictet Wealth Management. While cyclical stocks remain in favor, fund managers are becoming more selective, as pockets of the economically-sensitive asset class may have run too far, too fast.

“You hide in pricing power companies -- those companies that will be able to pass higher raw material costs and wages to the end customer,” said Cesar Perez Ruiz, chief investment officer at Pictet Wealth Management in Geneva. “Luxury, concessions companies linked to inflation are some of the sectors that will benefit, but even some cyclical or commodity companies have now more pricing power than several years ago too.”