184. It’s about being roughly right rather than precisely wrong

LF Ruffer Diversified Return managers Duncan MacInnes and Ian Rees talk us through their new product and explain why their “tractor over sports car” approach is hugely beneficial in these challenging times. The managers also explain why we are now at the end of a 30-year bull market and the implication that may have for investors looking for diversification. While capital protection is at the heart of their investment process, the pair also explain why the “always boring, always bearish” Ruffer tag is unfair and why they feel some companies in the commodities, industrials and financials sectors will perform well in an inflationary world.
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An extension of the popular Ruffer Investment Strategy, the LF Ruffer Diversified Return is an absolute return vehicle which has the protection of investor capital at the heart of its process. Managed by Duncan MacInnes and Ian Rees, the fund aims not to lose any money on any 12-month rolling basis – with a specific focus on providing genuine protection in times of market stress. The vehicle is global and completely unconstrained, allowing the managers to invest across various asset classes, including equities, fixed income, currencies and derivatives – backed by a large desk of both macroeconomic and stock selection specialists.

What’s covered in this episode:

  • Being an all-weather fund and the benefits to investors
  • Why capital protection is at the centre of the investment process
  • The end of a three-decade long bull market and why investing in bonds and equities may not cut the mustard as a diversification strategy going forwards
  • Why conventional government bonds no longer provide investors with protection
  • How the team take an extra step on risk management by evaluating how their portfolio would do in any scenario – even a World War
  • Why the fund is more than just a home for the eternal pessimist
  • The managers explain the investment process and how a team of 30 analysts can all be heard
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