Initiation of coverage
POLAR CAPITAL TECHNOLOGY TRUST (PCT)
504.25p
Market cap: £5.62 billion
Benchmark: Dow Jones Global Technology Index
Snapshot
- Investment team has lots of experience and expertise in the technology sector over multiple investment and economic cycles.
- Trust invests in typically high-quality companies they believe can benefit from globally disruptive technological shifts, pivoting to a particular focus on AI (Artificial Intelligence), but including much else.
- Conservative investing approach, the trust is both large and highly liquid, and has delivered impressive long-term returns, although past performance is not a guide to the future.
Source: Polar Capital Technology Trust
Profile
Polar Capital Technology Trust (PCT) is one of the best, broadly-based tech funds around, and the sole tech fund specialist in the FTSE 100. Run for nearly 20 years by lead manager Ben Rogoff, he is supported by a team deep with technology sector experience and expertise, combining to deliver an excellent record of superior investment returns over multiple investment and economic cycles.
The trust believes that AI is reshaping industries, economies and the future of innovation, creating extraordinary opportunities for investors. PCT seeks to identify and invest in the real drivers of technology and AI adoption, carefully navigating powerful technologies while positioning for long-term growth.
Investment process
Investing in the technology space can be risky endeavour thanks to the startling pace of change and it is an area particularly prone to bouts of volatility.
What you want is a broad selection of high-quality, innovative companies exposed to long-run profitable technological change while avoiding the hype and bluster merchants which produce precious little shareholder return.
With a portfolio that typically runs to around 100 stocks, PCT not only captures the very largest companies – Nvidia (NVDA), Alphabet (GOOG) and TSMC (TSM) are its three top holdings (27 Feb’26) – but also tech companies you probably haven’t heard of.
These include companies listed across the US, Europe, Japan and other Asia-Pacific opportunities, some of which can be difficult for UK investors to otherwise access. Crucially, Rogoff and the team actively manage fund stakes and weightings.
Nvidia is a great example, lifting the fund’s stake from 3.9% of assets to the current 9.4% during a spell when the share price soared from around $45 to over $180 now.
In the portfolio
Source: Polar Capital Technology Trust
Performance analysis
PCT has become a byword for superior investment returns over many years. Over the past decade, the trust has delivered cumulative share price and NAV total returns of approximately 815% and 840% respectively, versus 682% of the benchmark.
That compares to rough equivalent total returns of around 280% and 315% for the S&P 500 and Nasdaq Composite.
Put another way, PCT’s share price CAGR is calculated at nearly 24.8% a year, versus 22.8% of the benchmark, or 14.3% and 15.3% for the S&P and Nasdaq.
Source: Polar Capital Technology Trust
Costs and charges
The sort of market savvy evidenced by PCT over years justifies its fees premium to passive tech ETFs, while it uses its scale to keep costs competitive versus other active tech trusts.
Ongoing charges are currently 0.77% a year, the second lowest in its AIC Technology & Technology Innovation subsector, while it axed performance fees in May 2025.
Gearing
PCT employs a conservative, low-level gearing strategy to enhance long-term capital growth, with net gearing frequently reported at 0% to low single digits. The trust uses borrowing strategically to invest in global technology stocks, allowing it to amplify returns, particularly when rising markets compensate for borrowing costs.
NAV discount
Heavily invested in AI stocks, PCT has experienced wild swings in its NAV discount, currently hovering -8.3%. Over the last year, the discount has ranged between -6.8% to -19.4%, averaging -9.8%.
The five-year average is -10.5%.
| Discount now | Discount average | Discount high | Discount low |
| -8.3% | -10.5% | -0.3% | -19.4% |
Source: Trustnet
While currently trading below medium-term averages, PCT could be destabilised by activism down the line, particularly by Saba Capital Management, the US hedge fund activist heavily targeting UK investment trusts trading at wide NAV discounts.
There’s no reason to believe PCT will fall under Saba’s gaze, but other tech trusts have, so it remains a risk.
Recent manager commentary
- Global equities rose in February despite political and geopolitical uncertainty.
- AI spending expectations rose sharply after recent company results, with the large cloud providers now forecast to invest $667bn in 2026 – c60% higher than last year – as the AI infrastructure buildout continues at pace.
- AI revenues are scaling rapidly, with Anthropic’s ARR run rate increasing from $9bn at the start of the year to $19bn by early March.
- Q4 earnings season was characterised by strong fundamental results in companies exposed to AI infrastructure investment.
- 2026 has seen a meaningful rotation away from companies or subsectors perceived to have AI risk in favour of the secular AI infrastructure winners, those companies providing the physical building blocks of AI such as semiconductor chips, data centres and power infrastructure.
- In our view, 2026 will be the year AI model performance and capabilities improve so much that the ability to supply will be the differentiator, favouring the larger vendors who have secured key components at scale years ahead. OpenAI’s recent $110bn financing round has alleviated funding concerns that weighed on its supply chain until recently. Investors now await the next generation of frontier models from OpenAI, xAI and Meta, which will be the first to be trained on larger clusters of Blackwell hardware.
Disclaimer: The author Steven Frazer has a personal interest in Polar Capital Technology Trust.
