Ruffer duo: November sell-off was a 'dress rehearsal' for future asset price shifts

Portfolio 'stress tested' by Trump win

Steve Russell and Hamish Baillie, managers of the Ruffer Investment Company, have described November's bond sell-off as a "dress rehearsal" for bigger moves in asset prices to come next year.

The manager duo said Donald Trump's victory in the US Presidential Election at the start of last month created a "stress test" for the portfolio, which they believe has held up relatively well given this backdrop. The month saw a sharp sell-off in bonds across the globe, with benchmark 10-year Treasury yields jumping from 1.8% prior to the election to 2.4% (currently trading at 2.34%).  This move also triggered redemptions from 'bond proxies', which have been popular with investors as a safer equity investment option, and a reversal into cyclical stocks. Over the month of November,...