It seems like investors today are caught between a rock and a hard place -- a bear market to the left and inflation to the right. And recently, several fund managers have begun to voice concerns that inflationary pressures may become even more of a concern.

A rising tide
Merrill Lynch's (NYSE: MER) global fund manager survey for the month of May revealed that fund managers have a slightly improved outlook for growth across the globe, but are more pessimistic about inflation. According to the survey, the percentage of respondents who thought a recession was likely in the next 12 months fell from 40% last month to 29% this month. However, those managers who felt global inflation would rise in the coming year more than tripled from 7% in April to 25% in May.

Most of us probably agree with the idea that inflation is on the rise and set to go higher -- we've all felt the pinch at the gas pump and at our local grocery stores. But what can investors do to protect their portfolios against higher inflation?

The usual suspects
Well, there are the traditional hedges against inflation, like real estate and commodities. If you want to dip your toe into these corners of the market, do it with a low-cost exchange-traded fund like the Vanguard REIT Index ETF (AMEX: VNQ) or the iShares COMEX Gold Trust (AMEX: IAU). Just remember that sectors like these are prone to stomach-churning short-term drops, so don't invest if you don't like volatility.

The important thing to keep in mind is that stocks are generally a good hedge against inflation in the long run. Theoretically, as long as a company can pass its costs on to consumers, its earnings and revenue should grow at least at the same rate as inflation. While inflation may mean higher prices for consumers, it can also mean higher profits for companies with pricing power. That means merely staying invested in the stock market is one of the best, and easiest, things an investor can do to laugh in the face of rising inflation.

If you're wondering how you pick which stocks will give you inflation protection, check out the Fool's Champion Funds investment newsletter -- we bring you the best mutual fund picks in the business, led by managers who can capitalize on economic trends both good and bad. And try not to fret over the short-term effects of inflation on your portfolio -- you'll have enough to worry about when filling up your SUV at the gas station.

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Amanda Kish heads up the Champion Funds newsletter service and does not own shares of any of the companies or funds mentioned here. See the Fool's disclosure policy.