Which investment vehicle is least suitable for avoiding inflation risk?

The 10-year Treasury note is least suitable for avoiding inflation risk because it typically offers a fixed interest rate, which does not adjust for inflation over time. While you receive regular interest payments and the principal back at maturity, the purchasing power of those payments can diminish if inflation rises during the term of the note.

In contrast, TIPS (Treasury Inflation-Protected Securities) specifically adjust their principal value based on inflation, making them a more effective vehicle for preserving purchasing power against rising prices. Variable annuities often allow for investment in options that can potentially adjust for inflation, and blue chip stocks generally have a history of increasing dividends and capital appreciation, providing a hedge against inflation over the long term. Thus, the fixed nature of the 10-year Treasury note makes it less suitable for investors concerned about inflation risk.