Duncan MacInnes discusses COVID-19: how it has changed the investment landscape, the impact on the Ruffer portfolio and what could happen next.
This is the first episode of a new series of podcasts, where Ruffer will be exploring the investment universe and sharing their interpretation of what’s going on.
“It’s our view that we are moving through an economic regime change. Coronavirus is not the end of something, in fact it has accelerated a lot of trends that were already in motion—inequality, populism, deglobalisation and perhaps environmentalism and government involvement in our daily lives.
The conclusion is we think this will result in a wholly different economic and market landscape going forwards, so it will be essential to focus on keeping client’s capital safe.
Before this event we were worried about avalanche risk and valuation risk. Today we are still facing valuation risk—perhaps to a slightly lesser extent but we are now facing inflation risk and the fact that shareholder capitalism is likely to be under threat.
Because we have managed to preserve capital through this crisis so far and deliver a positive return, we are in a position to be able to be opportunistic and pick up bargains as and when they emerge as I think it’s too much to hope that it will be plain sailing from here.”