Monthly Investment report December 2019

RUFFER INVESTMENT COMPANY LIMITED

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

LEI 21380068AHZKY7MKNO47

Attached is a link to the Investment Monthly Report for December 2019.

http://www.rns-pdf.londonstockexchange.com/rns/1970Z_1-2020-1-8.pdf

"During December the net asset value of the Company rose by 2.2%. This compares with a rise of 3.3% in the FTSE All-Share index. During the year the Company's NAV rose by 8.4% on a total return basis. This is in line with our long term average and has been achieved while carrying a significant amount of protection in the portfolio.

One of the notable changes in recent years has been the relentless flow of shocking news events. It is scarcely believable that in a single month we could witness the impeachment of a US president, a decisive political shift in the UK General Election, the announcement of a new head of the Bank of England, the agreement of a trade deal between the world's two largest economies and a possible reinterpretation of the mandate of the world's most influential central bank. And yet all these events occurred in December alone. What is more, investors have become immune to this level of sensational activity to such an extent that markets hardly flinched in either direction. For better or worse, these are truly medicated markets, driven by liquidity flows more than fundamentals.

We had already hedged much of our overseas currency exposure prior to December and this insulated the portfolio from further sterling strength in the run up to and aftermath of the Tory election victory. Furthermore, the 35% reduction in the duration of the index-linked book, after a strong run through the summer, has helped. While focus will quickly shift to the mechanics of a UK/EU trade deal, the UK economy looks set to benefit from greater political certainty and forward momentum on Brexit. This will draw in capital, which had been sidelined while global investors waited to see which way the cards would fall in the election. We should expect to see a pick-up in corporate activity and probably rising consumer confidence even if the fiscal boost takes longer to come through. UK assets look cheap in an expensive world even after the post election bounce. In recent months, we have been adding to UK equities which now represent the portfolio's largest geographical equity allocation. These holdings contributed strongly to December's performance.

Looking forward, while we see opportunities in equity markets, we worry about the combination of highly indebted corporates and consumers, widespread insouciance on inflation and growing concerns about liquidity mismatches. A year ago no one thought that markets would rise in the coming year and now no one thinks that they can fall. We remain positioned to protect and grow our investors' assets in either outcome."

Enquiries:

Praxis Fund Services Limited

Gail Adams

DDI: +44(0)1481 755584

Email: ric@praxisifm.com