Here are the favorite inflation trades of big investors like David Einhorn and Paul Tudor Jones

Published Wed, Nov 10 202110:58 AM ESTUpdated Wed, Nov 10 202111:11 AM EST

Another hotter-than-expected inflation report hit the markets Wednesday, confirming what big investors have been warning for months: Persistent price pressures are becoming a big threat to asset prices. Here is where to hide out and potentially profit from inflation, according to notable investors David Einhorn and Paul Tudor Jones. The consumer price index surged 6.2% from a year ago in October, the most since December 1990, the Labor Department reported. The reading surpassed the 5.9% Dow Jones estimate. The data comes after a slew of big-name investors repeatedly denounced the notion from the Federal Reserve that the current price pressures are "transitory" or temporary. Escalating inflation could cause the central bank to tighten policy more quickly than it has indicated, which many fear would not bode well for stocks. Paul Tudor Jones said recently that inflation will be much worse than expected, and he believes the trillions of dollars in Covid-19 stimulus in the system are to blame for the persistent inflation. The founder and chief investment officer of Tudor Investment on Oct. 20 called inflation the "No. 1 issue facing Main Street investors" and said it's the single-biggest threat to financial markets and society in general. The longtime trader said it's time to double down on inflation hedges, including commodities and Treasury inflation-protected securities, known as TIPS. Gold futures hit their highest level since June 15 on Wednesday, reaching $1,870.60 per ounce. Jones has previously said bitcoin is a good inflation hedge , calling it a "portfolio diversifier" and a "story of wealth." Bitcoin hit a new intraday all-time high of $68,982.20 on Wednesday. Einhorn's favorite inflation trades Greenlight Capital's David Einhorn has been aggressively betting on inflation since mid-2020, and his trades have paid off handsomely. The hedge fund manager recently revealed his biggest holding right now is homebuilder Green Brick Partners , a bet on rising housing prices. The stock is up nearly 12% year to date after doubling in 2020. He also owned a big stake in Canadian mining company Teck Resources , according to a regulatory filing of his holdings as of the end of June. Einhorn said it is a play on a rebound in base metal prices. The hedge fund also invested in CNX Resources to take advantage of an expected bump in natural gas prices, as well as Chemours Company to bet on a titanium dioxide price increase. Einhorn also held a position in Brighthouse Financial to capitalize on equity markets' rebound and eventual higher long-term interest rates, he said previously. The manager said he has been betting on inflation through an indirect method — inflation swaps, a derivative of Treasury inflation-protected securities.

Paul Tudor Jones speaking at the World Economic Forum in Davos, Switzerland, January 21, 2020.

Adam Galica | CNBC

Here is where to hide out and potentially profit from inflation, according to notable investors David Einhorn and Paul Tudor Jones.