Inflationary Risk

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DEFINITION of 'Inflationary Risk'

The uncertainty over the future real value (after inflation) of your investment.

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BREAKING DOWN 'Inflationary Risk'

This is the risk that inflation will undermine the performance of your investment.

Looking at results without taking into account inflation is the nominal return. The value you should care about is the growth of your purchasing power, referred to as the real return.

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