- Ruffer’s bearishness has been a headwind in 2023
- But it should act as a hedge if recession hits hard
- It could have acted more quickly to combat the discount
Ruffer Investment Company (RICA) has struggled this year, leaving investors wanting on its promise of “consistent positive returns, regardless of how the financial markets perform”. However, the popular trust’s managers have recognised their mistakes, and have been through this all before. So can they turn it around?
The trust’s net asset value (NAV) is down by 9.5 per cent between the start of the year and 6 October, with the share price doing even worse, losing 13 per cent. As its recently published annual report to June 2023 highlighted, managers Duncan MacInnes and Jasmine Yeo did not call the timing of recession right. Ruffer is known for its consistent bearishness, but it has been blindsided by how long the consequences of rate rises have taken to show.
In their latest results, the managers wrote that they “underestimated the willingness of the US consumer to keep…