RIT Capital struggling to find attractive investments

RCP : RIT Capital struggling to find attractive investments

RIT Capital Partners has published its interim figures covering the first half of 2014. The net asset value total return was 2.4% for the period. This compares to a 4.1% return on the MSCI All Countries World Index and a 2.6% return on a benchmark of RPI +3% per annum (used by RIT Capital partners as a yardstick to measure its performance). Like many other funds, they point to Sterling strength as a problem for the portfolio, despite, they say, having a much higher weighting to Sterling assets than any time in recent history.

The £400m they borrowed to take advantage of low rates was deployed in absolute return and credit strategies. The Chairman’s statement says this has paid off.

Lord Rothschild’s Chairman’s statement also says that they are struggling to find investment opportunities that are likely to benefit from structural tailwinds at attractive valuations and which are not conditional on short-term monetary policies. He says almost every asset class is highly priced by historical standards.