Chair’s statement

“Against an unusually broad range of possible futures, the Board continues to have confidence in Ruffer’s ‘all‑weather’ strategy”

Overview

Ruffer Investment Company Limited (RICL or the ‘Company’) delivered resilient performance in the year ended 30 June 2026. Net asset value total return (NAV TR) per share was 4.6%. The discount of the share price to NAV narrowed from 3.4% as at 30 June 2025 to 2.6% as at 30 June 2026, increasing share price total return (share price TR) to 5.5%.

Throughout the financial year, the Board has continued to focus on enhancing shareholder value.

A key action has been managing the discount and premium of the share price to NAV via share buybacks/issuance and the enhanced marketing strategy. Further progress was made during the year to maintain credible discount control. The average discount of the share price to NAV reduced from 4.6% in the 12 months to 30 June 2025 to 2.4% in the year to 30 June 2026. The proportion of the time that RICL shares have traded at a discount to NAV of wider than 5% has dramatically reduced over the past two years. The Board believes that this focus on discount control is an important tenet for a company which has the aim of capital preservation.

A second key action has been a review of the management fee with Ruffer LLP (‘Ruffer’ or the ‘Investment Manager’). From 1 January 2027, Ruffer LLP will receive a management fee of 1% of the lower of the Company’s market capitalisation and its net assets, replacing the current annual management fee of 1% of net assets. The revised structure creates greater alignment between the Company and the Investment Manager.

These initiatives are discussed in greater detail below.

Nicholas Pink

Chair

NAV total returns versus volatility

July 2004 to June 2026

Source: Morningstar, Ruffer, data from July 2004 to June 2026. Constituents Ruffer Investment Company, RIT Capital Partners, Capital Gearing, Personal Assets, BH Macro, Twice Bank Rate, FTSE All-Share, FTSE World Government Bond Index. BH Macro data is from 2007. Volatility is not a complete measure of risk but provides a basis for comparison

Key performance indicators (KPIs)

The Company has seven KPIs, which are detailed on page 2 of the Annual Report.

NAV TR over the 12 months to 30 June 2026 was 4.6%. The discount of the share price to NAV narrowed marginally to 2.6% at 30 June 2026 (from 3.4% at 30 June 2025), resulting in a slightly higher share price TR of 5.5% over the same period.

The Company’s performance therefore met the Company’s aim to generate consistent positive returns, however financial markets are performing. Nonetheless, returns over 12 months fell short of the Company’s objective of twice the Bank of England base rate.

The Board carefully evaluates the performance of the Investment Manager over various time periods. RICL’s performance has exceeded its objective over ten and 20 years, but has fallen short over one, three and five years.

Over the entire 22 years since inception to 30 June 2026, the Company has delivered an annualised NAV TR of 6.7%, exceeding the objective of twice the Bank of England base rate, which averaged 4.1% for the same period. This has been achieved with lower volatility than equities and bonds, as shown in the chart above.

The Company’s annualised dividend yield for the period was 2.1% (2025: 2.1%), reflecting historical dividend payments. This represents a material yield figure by RICL’s historical standards, reflecting the high level of portfolio revenue in the year, primarily due to a relatively high allocation to bonds and prevailing bond yields.

The ongoing charges ratio was 1.086% (1.074% in the year to 30 June 2025).

Investment performance

The 12 months to 30 June 2026 was characterised by a tug of war in markets. Geopolitical instability fanned the flames of too-hot inflation and undermined bond markets, whilst the transformative potential of AI drove the equity rally. A typical balanced portfolio comprising 60% equities and 40% bonds would have enjoyed returns of c 15% in the year to 30 June 2026, but this belied the fact that global bonds marked time over the period; almost all the gains were driven by global equities. In addition, within global equities, performance was concentrated in a narrow group of US and Asian AI winners. By some measures, global equity market breadth stood at the narrowest in 20 years based on the proportion of stocks that outperformed global indices.

Against this challenging backdrop, the Company’s performance in the year to 30 June 2026 was resilient – RICL’s NAV TR was 4.6%. However, the year was a game of two halves. In the six months to 31 December 2025, RICL NAV TR was 4.9% due to the positive contribution from equities, precious metals exposure, cash and short-dated bonds more than offsetting the cost of protective strategies and the weakness of the yen.

In contrast, over the six months to 30 June 2026, RICL’s NAV TR was -0.3%, a rare six‑month period of negative performance for Ruffer. This was because the cost of holding protection and yen weakness more than offset gains from equities, cash and short-dated bonds and commodity exposure. Ruffer’s capital preservation mandate explains the decision to eschew a small group of very highly valued cyclical AI stocks and continue to own protection against the risk of bonds and equities falling together. Overall, the 12 months to 30 June 2026 therefore met RICL’s aim of delivering positive returns, but fell short of the objective of twice the Bank of England base rate. The Board shares the Investment Manager’s view that, whilst the final quarter of the year to 30 June 2026 was particularly frustrating, RICL’s performance over the broader 12-month period demonstrated the value of the Company’s balanced approach.

More details about investment performance can be found in the Investment Manager’s Year End Review on pages 12 to 38.

Benefits of closed-ended structure

The past two years have seen debate around the future of the investment trust or closed-ended sector and whether it delivers value to shareholders. Between 2022 and 2025, the number of London-listed investment companies shrunk by 21%.

Meanwhile, studies show the benefit of the closed-ended structure relative to open-ended for shareholders in its use of leverage, ownership of illiquid assets and buyback/issuance of shares at a discount/premium to NAV.

The Company utilises all the benefits of the closed-ended structure for the benefit of shareholders.

First, leverage. RICL will not utilise gearing via debt, given its capital preservation aim, but the Investment Manager does opportunistically use derivatives, which are a form of leverage.

Second, ownership of illiquid assets. Currently, these include specialist credit funds, designed to pay off in periods of market stress. These assets are typically held via RICL’s holdings in the specialist funds Ruffer Protection Strategies International (RPS) and Ruffer Illiquid Multi Strategies Fund 2015 (RIMSF). RPS and RIMSF represented 10% of the Company’s NAV as at 30 June 2026. The Company may also opportunistically acquire less liquid growth assets. For example, RICL currently has holdings in several UK investment trusts.

Finally, the Company buys back and issues equity, enhancing NAV per share. Since 2023, RICL has bought back 23.2% of its issued share capital at an average discount of 4.8%, enhancing NAV per share.

These features have helped RICL outperform similar peer open‑ended funds by an average of 1% per annum over the past decade.

Looking forward, the revision to the management fee to calculate the fee on the lower of market capitalisation and net assets, a methodology which is becoming increasingly common in the closed-ended fund universe, is a welcome development. The revised fee structure provides protection for RICL shareholders, ensuring a lower fee when the Company’s share price trades at a discount to NAV per share, compared to the equivalent fee on net assets. Since inception, RICL has traded at a discount for c.40% of the time. Should that pattern continue, the new fee structure will provide a benefit to shareholders whenever the shares trade at a discount and, like any reduction in cost, that benefit is cumulative, compounding over time.

The Board will continue to evaluate how it can utilise the benefits of the closed-ended sector for the benefit of shareholders.

Investment management

Ruffer’s asset allocation is managed by its Co-Chief Investment Officers (Co-CIOs). In June 2026, Ruffer LLP announced Jon Dye’s appointment as Co-CIO effective 1 October 2026, working alongside existing Co-CIO Henry Maxey. Jon has worked at Ruffer for 16 years as Head of Research and then Head of Equities, including managing an equity sleeve that has contributed to RICL’s performance since 2021. Subsequently, Neil McLeish resigned as Co-CIO in July for personal reasons. The existing fund management arrangements for RICL are unchanged.

Management Fee

In September 2026, the Company announced that, following a review of the Company’s fee arrangements, it has agreed revised terms with the Company’s Investment Manager. With effect from 1 January 2027, the Investment Manager will be entitled to an annual management fee of 1% of the lower of the Company’s market capitalisation and its net assets, calculated on a monthly basis. This replaces the current annual management fee of 1% of net assets. The revised structure creates greater alignment between the Company and the Investment Manager, and reflects the Board’s continued focus on delivering value for shareholders.

Earnings and dividends

The Company’s earnings per share of 13.46p for the 12 months to 30 June 2026 was split between 6.47p of revenue and 6.99p of capital (compared to earnings of 12.61p for the 12 months to 30 June 2025, split 5.78p of revenue and 6.83p of capital). The Company continues to invest for total return, which gives the Investment Manager the flexibility to own any asset consistent with achieving the Company’s objective. Consequently, revenue is not the primary goal but rather a by-product of the investment portfolio.

The Board is committed to distributing at least 85% of revenue earned in any given year to ensure that the Company’s shares are not categorised by HMRC as non-mainstream pooled investments (NMPI). Having paid an interim dividend of 2.85p in April 2026, the Company has declared a second interim dividend of 3.32p on 30 September 2026 (3.35p in 2024/2025). The dividend will be paid on 23 October 2026. The remaining balance of revenue earned has been retained to add to the revenue reserve (£19.2 million or 6.5p per share at 30 June 2026), which may be used, where the Board believes it appropriate, to cushion dividends against future fluctuations in revenue per share.

Discount/premium management

The Board has a clear policy to manage any premium or discount of the RICL share price to NAV per share.

The Board believes that, in the long run, the discount or premium will be determined by investment performance, as evidenced by NAV TR. In the short run, the Board will take action to enhance shareholder value and manage the difference between the share price and NAV per share. Over the past three years, the Board has implemented progressively stronger measures to achieve this. The intensity of the share buyback has increased significantly as and when required and there has been a greater focus on marketing to retail clients.

Together with improved investment performance, this all resulted in greater demand for RICL shares from wealth and retail shareholders over the past 12 months. As shareholder demand increased, the Company buyback commensurately reduced. During the year, RICL briefly traded at a premium to NAV per share, allowing the first issue of RICL shares since 2023. The discount of share price to NAV per share reduced from an average of 4.6% in the 12 months to 30 June 2025 to 2.4% in the 12 months to 30 June 2026.

The Board’s discount policy is, around a mid-single-digit discount, to assess with the Broker the market position in the shares: who are the sellers and buyers and what are their reasons; what are the volumes which are moving the share price significantly relative to the average liquidity levels; and where are and what constitutes potential buyers and at what price level. The Investment Manager is not apprised of these discussions because of potential conflicts of interest.

The Board makes its own independent judgement on whether it deems the discount to be a temporary aberration or a longer-term signal for which action other than a share buyback may be required.

The Board’s policy to manage any premium of the share price to NAV per share is to issue shares at a premium to NAV per share.

The objective of the buyback, issuance and other measures is to make money for remaining shareholders by adding to the NAV per share, to bring the share price closer to the NAV per share and to help provide liquidity in the shares.

The Company’s policy has resulted in the buyback of 7.7 million shares at a cost of £22.2 million in the 12 months to 30 June 2026, representing 2.6% of the share capital at the beginning of the year. These buybacks occurred at an average discount of 3.7%, which has enhanced NAV per share by 0.3p or 0.1%. Since 30 June 2026, the Company has bought back a further 8.8 million shares or 3.0% of the Company’s shares in issue on 30 June 2026. In April 2026, the Company issued 0.5 million shares at a small premium to NAV per share.

The Board is committed to retaining the tools necessary to implement this policy. The Board proposes to renew its powers to buy back up to 14.99% of the Company’s shares in issue at the 2026 Annual General Meeting (AGM). Additionally, the Board can operate a tender mechanism at any time it chooses, if deemed necessary.

Marketing

Following a review of the positive progress already made, the Board and Ruffer agreed the continuation of the enhanced marketing strategy for direct-to-consumer shareholders in 2026. This strategy primarily targets retail shareholders, who own a significant proportion of the Company directly or via investment platforms.

The results have included a revised website for RICL; meetings between the Board, the fund managers and the financial press and financial analysts; appearances by the fund managers on podcasts aimed at retail investors; direct advertising in relevant finance publications; a letter to shareholders on investment platforms to establish a regular mailing list; the redesign of the Interim and Annual Reports (nominated for Best Generalist Report and Accounts in the Association of Investment Companies Shareholder Communication Awards); and the organisation of an annual shareholder event in London.

The Board and Ruffer use various metrics to track progress of the initiatives; notably, the proportion of RICL owned by shareholders on the largest investment platforms increased over the past year.

Board matters

The Board is committed to conducting an external review of Board effectiveness and Directors’ fees triennially; during 2026, external consultants were selected and the next reviews will be reported in 2027.

In September 2026, the Board held its annual ‘kick-the-tyres’ session. This involved meetings with Ruffer senior management, the Co-CIOs and fund managers to conduct due diligence on investment strategy and asset allocation, investment risk, cyber risk, protection strategies and responsible investment.

Company Secretary

Following a review of the Company’s service provider arrangements, the Company appointed Aztec Financial Services (Guernsey) Limited (‘Aztec’) as Company Secretary, effective 1 June 2026. Aztec will work alongside Apex Fund and Corporate Services (Guernsey) Limited, who continue as Administrator. The Company’s registered office has changed to PO Box 656, East Wing, Trafalgar Court, Les Banques, St Peter Port, Guernsey, GY1 3PP.

Annual General Meeting (AGM)

The Company’s AGM will be held at noon on 9 December 2026, at the offices of Aztec. Shareholders are invited to attend. The Board encourages all shareholders to exercise their votes by completing and submitting the proxy election form in advance.

Any questions should be submitted via email to the Company Secretary at ruffer@aztecgroup.co.uk

Recognising that some shareholders will be unable to attend the AGM in person, a separate opportunity for shareholders to meet some of the Board members and receive a presentation from the Investment Manager will be provided on 11 November 2026 at Ruffer’s London office. To receive an invitation, please sign up for shareholder updates by using the QR code as provided in the Annual Report.

Outlook

There is a clear historical relationship between starting real interest rates and subsequent real returns for equities and bonds. At today’s level, that relationship points to a real return for a typical 60:40 portfolio of 3.7% per annum.1 However, this is a central case, not a forecast. The path to that return is unlikely to be plain sailing. Volatility carries a cost – a sharp loss can take an outsized gain to recover, interrupting the compounding process that drives long‑term returns.

The Bank for International Settlements’ (BIS) June 2026 annual report is a guide to the shifting tides. It flags four risks to the economic outlook: sticky post-shock inflation; an AI investment boom that could reverse if payoffs disappoint; financial vulnerabilities from stretched valuations and opaque AI-related leverage; and mounting fiscal pressure amid slowing growth – set against a market that seemingly is underpricing these dangers.

Arguably, narrow equity market leadership and signs of speculative excess might point to equity markets behaving as Graham’s ‘voting machine’2 rather than weighing fundamentals. The BIS study of the impact of AI on growth and interest rates underscores how wide the uncertainty is stemming from just one factor, modelling outcomes ranging from a transformative AI scenario that lifts growth exponentially to a demand-bottleneck scenario where growth falls below trend as automation stalls and lost jobs mean lost consumers. This is a reminder, perhaps, to borrow Zhou Enlai’s famously cautious verdict that it is ‘too early to tell’ what AI means for markets.

Against this unusually broad range of possible futures, the Board continues to have confidence in Ruffer’s ‘all-weather’ strategy. Ruffer’s current preference for less crowded, better-valued exposures positions the portfolio to benefit if AI-led growth broadens, whilst its resilience and valuation discipline provide protection should leadership narrow or expectations unwind.

  1. Global Investment Returns Yearbook 2026 – Elroy Dimson, Paul Marsh, Mike Staunton; derived from evidence based on the full range of markets for which there is complete history 1900-2025
  2. Warren Buffett 1993 refinement of Benjamin Graham/David Dodd concept from 1934 text ‘Security Analysis’. Buffet’s text has been widely popularised as ‘In the short run, the market is a voting machine, but in the long run, the market is a weighing machine’

Nicholas Pink

29 September 2026