Top Ten Stocks For A K-Shaped Economy (As Well As Bitcoin)


The Bank of England predicted a V shape. This became the bathtub shape, then the square root shape. Now, please welcome the K-shaped recovery.

Courtesy of Ruffer Investment’s fund managers, the new paradigm consists of dramatic winners (the top half of the letter “K”) thriving at the expense of dramatic losers (the bottom half).

Some classic Ks: Everyone is on Zoom and Peleton for their meetings and workouts, but offices and gyms have to close. Deliveroo is floating

£ 8 billion, but more than 800 restaurants have closed. Boohoo grows as Arcadia fades.

People also receive the special K treatment. The rich are benefiting from rising asset prices due to low interest rates, while millions are newly unemployed, on vacation or clinging to jobs with reduced wages.

As Ruffer says, “The K is not okay”.

Politicians – Witness Joe Biden – know this and will push through tax hikes, large business regulation and Keynesian government investment in the economy.

The national debt will rise, but how can it be paid off?

Austerity measures are a political no-no.

Ruffer believes governments will raise prices to reduce debt (with the added benefit of hitting asset prices and hurting the rich).


Ruffer has bought “protective” assets like gold, index linked bonds and credit default swaps, if the guess is correct.

Well, in Ruffer’s anti-inflation armory, too, is Bitcoin, which has been both at the top and bottom of the K for a year.

That could affect your view of Ruffer’s predictions in either case …

Ruffer’s Top 10 UK Picks

Ruffer made a decent fist in 2020 with Net Asset Value up 13.5% compared to the FTSE All-Share’s 9.8% decline, which increased particularly in the second and third quarters as the bank and government incentives that boosted stock values. Ocado, Fujitsu, and Sony were the top three performers and it rode a big wave with Bitcoin, which it bought into later in the year. Bitcoin now makes up around 2.5% of its portfolio.

Here are the top UK stocks by percentage of the fund

Ruffer SICAV UK Trust for medium and small companies (3.8%)

Lloyds Banking Group (2.5%)

Landscape characteristics (1%)

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