The Anti-Debasement ETF Portfolio

My investment purpose has always been more than chasing high returns. I want a portfolio that one day produces enough income that I don’t have to trade my time for a wage.

More subtly and just as importantly, I aim to outpace debasement itself—the slow erosion of purchasing power that occurs when currency loses value, inflation rises, and asset prices get warped by policy.

Debasement isn’t theoretical. Look at U.S. data: median wages have stagnated in real terms for much of the past decade, home‐price growth has far outstripped wage growth, and the dollar’s purchasing power has been steadily shrinking.

If you’re not actively investing in 2025, realistically you’re on the back foot. Gen Z’s increasing embrace of financial nihilism—the rush into risky options trades, high leverage, and dramatic bets—is a symptom of control lost over traditional paths.

There is a better way. Four ETFs can be combined into a satellite allocation that stands apart from the usual stocks and bonds. These funds are designed to withstand debasement from inflation, currency weakness, or policy distortion, and don’t overlap heavily with your core portfolio. Let’s build it!

25% in Real Estate Investment Trust (REIT) ETFs

A real estate investment trust, or REIT, is a pass-through entity that must distribute at least 90% of its taxable income to shareholders to avoid paying corporate income tax.

Instead of owning properties directly, you own shares in a company that owns and manages them—collecting rent, paying expenses, and distributing the rest to investors as dividends.

REITs are a natural hedge against debasement because rents can rise with inflation. Many commercial leases even have built-in rent escalators—clauses allowing regular rent increases tied to inflation or market rates.

Some properties operate under triple-net leases, meaning tenants, not landlords, pay most operating costs like insurance, maintenance, and property taxes. That stabilizes cash flows and preserves real purchasing power when costs rise.

For broad, low-cost U.S. REIT exposure, I like the Schwab U.S. REIT ETF (SCHH). It charges only 0.07% in annual fees and currently pays a 3.58% 30-day SEC yield. It tracks the Dow Jones Equity All REIT Capped Index, a basket of 124 REITs spanning sectors such as residential, industrial, office, retail, and data centers.

Importantly, SCHH excludes mortgage REITs, which don’t own real property but instead hold mortgage-backed securities—high-yield but poor total-return instruments that add leverage risk and interest rate risk rather than true real-asset exposure.

25% in Master Limited Partnership (MLP) ETFs

For inflation-linked income tied to real assets, master limited partnerships (MLPs) fit perfectly. MLPs are pass-through entities, much like REITs, that typically own energy infrastructure like pipelines and storage facilities.

They collect fees for transporting or processing commodities—revenue often linked to inflation escalators or long-term contracts. The catch is tax paperwork.

MLP investors receive a Schedule K-1 form listing their share of partnership income, deductions, and credits—often arriving late and complicating tax filings. ETFs solve that headache by handling all the accounting internally, letting investors receive a standard 1099 form instead.

For this niche, I prefer the Global X MLP ETF (MLPA). It’s the lowest-cost option at a 0.45% expense ratio and currently yields 8.83% on a 30-day SEC basis.

The fund tracks the Solactive MLP Infrastructure Index, focusing on the 20 most liquid MLPs. You get tax simplicity, reliable cash flow, and exposure to energy infrastructure without the paperwork.

25% in Bitcoin ETFs

Of all cryptocurrencies, Bitcoin is the only one I consider a credible debasement hedge. Its deflationary mechanics—a hard cap of 21 million coins and the halving cycle that cuts new supply roughly every four years, make it functionally immune to the kind of monetary expansion that erodes fiat currency.

When it comes to Bitcoin exposure, spot ETFs are far better than synthetic futures-based ones. “Spot” means the ETF holds actual Bitcoin in custody rather than using derivatives to simulate exposure.

My preferred choice is the Fidelity Wise Origin Bitcoin Fund (FBTC). While most competitors rely on Coinbase as a single custodian—creating a potential point of failure—FBTC uses Fidelity Digital Assets for self-custody.

Ideally, I’d advocate holding Bitcoin in cold storage directly— “not your keys, not your coins”—but I recognize not everyone has the technical ability to do so. FBTC is a practical alternative: low-cost at a 0.25% expense ratio, liquid, and backed by a trusted institution.

25% in a Gold ETF

The final piece of this anti-debasement portfolio goes to gold—the oldest and most enduring store of value in human history.

Central banks hold it, nations settle in it, and for thousands of years it has functioned as money. When inflation rises or currencies weaken, gold has consistently served as a stabilizer.

While silver, platinum, and palladium have their uses, gold remains the purest form of monetary metal. Physical bullion is ideal for full sovereignty, but for most investors, a spot gold ETF offers the same exposure with none of the storage, insurance, or liquidity hassles.

The lowest-cost choice is the iShares Gold Trust Micro (IAUM). It charges just 0.09%, holds 1,328,923.54 ounces (about 41.33 tonnes) of audited, physically allocated gold, and manages $5.3 billion in assets.

For a simple, transparent, and cost-efficient way to own gold, IAUM is as close as you can get to the real thing, without needing a safe.

Putting it together

The backtest paints an impressive picture, but it’s worth remembering that not all the ETFs in this portfolio existed for the entire period shown.

To fill the gaps, the model uses comparable ETFs and index-level data, so while it’s not a perfect reconstruction of what would have happened, it’s close enough to give us a reasonable sense of long-term performance dynamics.

That said, the outsized returns here are largely driven by Bitcoin’s explosive growth. A 25% allocation to such a volatile asset can supercharge returns, but also magnify drawdowns. I used a quarterly rebalancing schedule to keep the allocations in check, since Bitcoin’s rapid swings can quickly distort portfolio weights.

The main performance drivers are clear. Bitcoin provides asymmetric upside but carries extreme risk. Gold plays the role of a low-correlation hedge, while REITs and MLPs are income generators with more traditional market exposure and built-in inflation resistance. Together, they create a mix of hard assets and cash-flowing vehicles that move to different rhythms than a stock or bond portfolio.

Given the risk profile, I wouldn’t go all-in on this. Think of it as a complement to your core holdings of equities and bonds. Each of these components tends to be underrepresented, or entirely missing, in standard portfolios. Allocating even a small slice to an anti-debasement strategy can preserve purchasing power over the long run.