Ruffer Regulatory News (RICA)

RUFFER INVESTMENT COMPANY LIMITED

(a closed-ended investment company incorporated in Guernsey with registration number 41996)

LEI 21380068AHZKY7MKNO47

Attached is a link to the Monthly Investment Report for June 2020.

http://www.rns-pdf.londonstockexchange.com/rns/4210S_1-2020-7-8.pdf

During June, the net asset value of the Company rose by 0.3%. This compares with a rise of 1.5% in the FTSE All-Share index.

As we reach the halfway point in this tumultuous year it is worth taking stock of what has happened so far, and how we were able to both preserve capital through the initial market crisis and also benefit from the more recent rally. After a positive start to 2020, stock markets plunged in March on escalating fears of the global impact of COVID-19, with credit markets exhibiting a similar panic. In the fastest decline in stock market history, equity markets fell by a third in just 22 days, hitting their lows on 23 March, the very day the UK officially went into lockdown.

Cue the cavalry. Stock markets rallied in the second quarter as central banks, very much led by the US, swung into their now habitual role of supporting asset prices. The size of the monetary and fiscal intervention is unprecedented in peacetime and we wait to see whether it is sufficient to keep businesses and employment afloat, but for now at least, it has been a big enough bazooka to reassure investors. In April and May equity markets duly recorded one of their fastest recoveries. The US Federal Reserve was pumping money into the system, even buying junk (high yield) bonds and everything was back to normal, except of course it isn't.

What of the Ruffer portfolio through all of this? Whilst we in no way foresaw the coronavirus pandemic, with our core focus on capital preservation, if we are doing our job properly we would hope to navigate such crises in relatively good shape. We always hold protection in our portfolio against difficult times and have been particularly nervous of markets in recent years. Accordingly, we take only limited credit for emerging from the first quarter virtually unscathed and indeed posting a positive return in March as risk assets tumbled and our investments in 'fear' really did their job.

Since then stock markets have rallied, though whether this is based on a sober assessment of the true impact of the virus, or a sugar rush from central bank liquidity, is open to question. Having protected capital in the dark times, it is a cause for some satisfaction that we were able to make money from that stable base in the recovery. With no increase in risk (we retain a low but potent exposure to equities and still hold significant credit protections) we made decent returns as markets recovered, especially in April and May. A gain of 7.4% in the second quarter leaves us comfortably in positive territory year to date. Looking forward, uncertainty rules of course, but our equities are biased towards recovery and value, and so did well as hope returned to markets and should flourish if this continues. However, in what may be a harbinger of things to come, inflation-linked bonds and gold have driven recent performance just as much as, if not more than, equities.

Enquiries:

Praxis Fund Services Limited

Gail Adams

DDI: +44(0)1481 755584

Email: ric@praxisifm.com