How Investing in Commodities Can Be a Hedge Against Uncertainty

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  Here's your money briefing for Thursday January 2, I'm JR Whalen for the Wall Street Journal.

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  Many people select stocks as their main investment option,

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  but financial professionals recommend those managing their portfolio or 401k also include commodities like gold,

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  oil or corn, especially as inflation is creeping higher.

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  Commodities reflect current prices as opposed to stocks which may reflect future earnings potentials.

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  So commodities will reflect what's going on now, and that is one of the reasons why the Indian inflation has,

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  because as demand for commodities goes up, the prices goes up.

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  We'll talk to Wall Street Journal contributor Debbie Carlson, after the break.

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  Financial professionals say commodities can be a good addition to your portfolio.

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  Wall Street Journal contributor Debbie Carlson joins me.

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  Debbie, when we say commodities, what types of investments are we talking about?

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  When we talk about commodities, we're talking generally about natural resources.

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  So that can range everything from crude oil to corn to cocoa, even to gold and silver.

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  So it's a wide variety of products.

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  Why do financial professionals recommend people consider including them in their portfolio?

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  Commodities don't always get the attention that stocks do,

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  and they're a great hedge, because they're usually not correlated with stocks.

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  They can be a good diversification hedge.

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  They can be a hedge against volatility.

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  They can be a hedge against inflation.

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