Ruffer Investment Company Limited Monthly Investment Report January 2020 (4821C)
10 Febbraio 2020 - 12:45PM
UK Regulatory
TIDMRICA
RNS Number : 4821C
Ruffer Investment Company Limited
10 February 2020
RUFFER INVESTMENT COMPANY LIMITED
(a closed-ended investment company incorporated in Guernsey with
registration number 41996)
LEI 21380068AHZKY7MKNO47
Attached is a link to the Investment Monthly Report for January
2020.
http://www.rns-pdf.londonstockexchange.com/rns/4821C_1-2020-2-10.pdf
During January, the net asset value of the Company fell by 2.2%.
This compares with a fall of 3.3% in the FTSE All-Share index.
We wrote last month how markets have seemingly become immune to
negative news. This continued as 2020 began. The US assassination
of Qassem Soleimani, a top general in the Iranian Revolutionary
Guard, brought only a temporary hiccup. Despite the clear increase
in geopolitical tensions, within days stock markets had recovered,
the price of oil had retreated to its pre-attack levels and gold
had fallen back to $1,550. It would seem that the current
administration in the United States is rewriting the rules that
markets have known and evidently enjoyed for the past decades, yet
investors remain unmoved.
Why did equity markets not flinch? Partial, if not full,
responsibility, must reside with the actions of global central
banks. Overwhelming any geopolitical fears was the support provided
by the US Federal Reserve over the year end. They insist that this
is "not QE" but it looks a lot like it. These moves allowed
strategists to draw similarities with the Fed's actions around the
turn of the millennium. Therefore, the logic goes, there is more to
come from October to December's stock market rally. Hopefully, we
at Ruffer aren't the only ones who remember how that particular top
ended.
These dynamics held until the last few days of January when
suddenly there was one news event markets decided not to ignore. We
are no epidemiologists but can see how the shutdown of factories,
the hit to travel and tourism and the damage to already fragile
global trade, might hinder the upward march of stocks. The rise in
equity markets last year was driven almost exclusively by valuation
expansion and came despite falling economic expectations and
stalling profits. Further progress this year probably requires some
form of earnings growth, something which may now be under threat,
and when equity markets are priced for near perfection,
vulnerabilities inevitably arise.
The authorities may or may not bring the virus under control and
this may be another example of bad news that markets can look
through. We at Ruffer do not try to pick the moment when bull
markets end, in fact quite the opposite. By creating a portfolio
split between growth and protection assets we try to remove as much
timing from the equation as possible. If these worries blow over,
our equities, focussed on the UK and Japan, are capable of driving
decent returns as evidenced by the 8.5% outturn for 2019. If this
is the moment when protection needs to take over, we are confident
that our credit and volatility protections stand ready to act.
On Thursday 27 February at 11:00am we will be holding our
bi-annual shareholder update. This time around it will take the
form of a webinar focussing on the investment strategy and outlook.
If you would like to dial in then please contact
investorday@ruffer.co.uk In the autumn the event will take place in
Ruffer's London office and the directors of Ruffer Investment
Company will be present and available to take questions from
shareholders.
Enquiries:
Praxis Fund Services Limited
Gail Adams
DDI: +44(0)1481 755584
Email: ric@praxisifm.com
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END
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