Ruffer launches daily liquidity version of total return fund

Ruffer launches daily liquidity version of total return fund

Ruffer has launched a daily liquidity version of its £4bn Total Return fund in response to the "uncertain future" faced by financial markets.

In a statement released yesterday (September 9), the firm said the new fund - its first fund launch in ten years - will adopt the same investment approach as its existing four core funds, aiming to generate absolute returns with an “uncorrelated risk/return profile to the broader markets”.

Duncan MacInnes, the co-manager of the Ruffer Investment Company, will manage the LF Ruffer Diversified Return fund alongside Ian Rees.

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MacInnes said the fund is being launched in response to the challenges seen by investors in light of the "uncertain future" faced by global financial markets.

He said: “Global financial markets face an uncertain future which creates major challenges for investors. 

“Traditional asset allocation models will come under renewed stress as inflation volatility rises.

“By providing a more liquid expression of our investment strategy we can help support UK financial planners, wealth managers and the broader wholesale market with our ‘all weather’ uncorrelated investment approach.”

He added: “We believe we are entering a world in which bond and equity prices look poised to fall in tandem. In this environment true diversification and a lack of correlation to other asset classes or strategies will be absolutely vital to portfolio construction – this is where we believe the Ruffer approach can be of use to investors.”

The fund will be available through all of the major investment platforms, with the first net asset value scheduled for September 15.

Last week, a senior investment manager at 7IM said the traditional asset allocation model of a 60/40 split between equities and bonds can no longer be relied on.

Tony Lawrence said times have changed, particularly since the pandemic and lockdowns that started last March.

“In a period of consistently low bond yields, the safety and comfort that investing in bonds once provided can no longer be relied on.

“So, it’s vital that investors re-examine and re-imagine how that typical 40% fixed income allocation is formed. For those who are willing to break from tradition and look beyond the typical make-up of government and investment-grade corporate bonds, we believe there are pockets of opportunity to be found.”