The market value of Ruffer Investment Company (RICA ) topped £1bn for what is believed to be the first time late last week, following an 8% rally in the shares so far in 2022 on inflation and global volatility.

The archly defensive firm’s flagship multi-asset trust now trades at a share price premium of just below 5%, from around 2% at the beginning of the year, as a decade-long inflationary thesis has proved prescient.

Writing on LinkedIn, manager Duncan MacInnes said: ‘[Intel chief executive] Andy Grove famously said “only the paranoid survive” – we agree. We continue to be absolutely preoccupied with keeping our investors’ capital safe.

‘When I look at the depth and quality of the team around me at Ruffer LLP, I have never been more confident in our preparedness to meet the many challenges ahead – foreseen and unforeseen.

‘So many people internally and externally have had a hand in this. Thank you to all of you from myself and [co-manager] Hamish Baillie.’

On Friday the shares reached a high of 320p. At the time of publication that had fallen back to 318p, equivalent to a market cap of £997.7m, according to Refinitiv data. The trust’s net asset value currently stands at £945m.

With shareholders enjoying a three-year total return of 38.1%, the closed-end fund now leads its Flexible sector.

In their latest update, in early May, the managers noted that the prior month had offered a continuation of the broad trend of the first quarter, with the portfolio’s interest rate options and credit protection strategies offering the strongest returns as both equity and bonds fell.

‘Having predicted the return of inflation for many years, we now doubt the resolution of central banks to raise rates sufficiently far to choke it off,’ they wrote.

‘However, there is little doubt that interest rates are set to rise further. This means the key question right now is: what will break first, the market or the economy? With unemployment at record lows, it seems most likely to us that stock markets, bonds and credit snap before the economy hits recession, but we cannot be certain of this.

‘There is also the risk that the bursting of overinflated bubbles in one part of the market can drag everything else down. Accordingly, we remain cautiously positioned with 36% in equities and now almost half of that in more defensive stocks.’

The milestone means the trust has more than doubled in size during the pandemic, having been around £390m in size in late February 2020.

The closed-end fund carried out a damply-received £40.9m raise in December, a quarter of its upper target. But the board has been able to continually issue shares over the last two years due to strong investor demand, as the portfolio has held up strongly during market downturns.