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Bought some more today which I have gifted to a trust fund for my children. Time will determine the folly or wisdom of my decision
PCT, one of the performers of the year in the most in demand sector, trades at an ever higher discount while the likes of HFEL, on its continuous journey lower, maintains a premium against NAV.
on 27th May PCT/SMT/ATT, looks as if it may have been close to the bottom, up 7%,5%, and 1%.
The Report PCT issues with its finals is very long and takes some reading, but if you are looking for investment ideas, it is worth it - it gives excellent commentaries on the market and outlook for so many industries.
Hopefully the downside after my purchase yesterday at 16:13 is limited. My portfolio is structured for capital growth on a High Risk basis
From IC 16 June 22.
FUNDS
The tech stocks I'm buying amid the downturn
Polar Capital's Ben Rogoff tells Mary McDougall why he's dipping back into rapid growth companies despite recession risk
Mary McDougall
Polar Capital Technology Trust has reduced exposure to ecommerce and consumer businesses
It has added to software companies
The trust has been underperforming its benchmark because it has a lower relative rating to large US tech stocks
Tech investors' luck had to run out at some point. After sensational gains in 2020 and throughout most of 2021, the first half of this year is proving a very different story. Few people have been monitoring the sell-off as closely as Ben Rogoff, manager of Polar Capital Technology Trust (PCT), which has suffered a share price fall of a third since the start of the year, albeit it still had assets of £2.9bn as of 13 June.
Rogoff, who has been investing in technology for 26 years, has seen his share of bear markets, from the bursting of the dotcom bubble at the turn of the century to the financial crisis in 2008. “When the tech sector drops it can be quite painful,” says Rogoff, adding that each one he has endured has been very different. “This one is really about inflation and the loss of the 'Fed put'”. He describes Federal Reserve policy as such because it has, in effect, behaved like a put option contract by supporting markets with interest rate cuts and quantitative easing in recent decades.
The key question on investors minds is how much further the tech sell-off has to go. Rogoff recently noted to Investors' Chronicle that over half of companies' in the Nasdaq index have fallen by 50 per cent from their peaks, and said valuations of many companies are now materially much more attractive than they were last November.
“Calling bottoms and trying to work out if this is the time to buy is really just part of that conversation about risk and reward,” he says. “Last year we were worried about certain facets of the market – things like special purpose acquisition companies, ultra long duration investing and the fashion towards concentration in portfolios”.
Since then, there has been a sizeable derating of some of these assets and Rogoff says that he is just starting to dip his toes back into the water.
On a scale of one to 10, where one is the most bearish he could imagine being and 10 the most bullish, he says that he’s now at “around seven or eight”. And companies are a sort of “coincident indicator” because when things turn down in the economy companies don’t see it in advance but rather as it happens. He adds that the overwhelming sense from his colleagues attending company conferences is that “things are still OK”.
I missed out on trading the Big tech rallies over the last 3 years. Anyone else thinking of using polar capital technology trust to "buy into dips" now?
grayling .... scottish motgage with tesla amazon and medical pays a dividend, however has been racing down and forecast to go further down.. how does polar compare? They seem to hold similar stocks. I like dividends, with a decent co can just hold and hold.
Anyone any insights into 5% drop since the turn of the year? Link to 6% drop in NASDAQ over same period is main thing I can suggest?
PS correct there are no divis with this trust
Since when has Polar Capital Tech ever paid a dividend? Surely you have this mixed up with another trust?
In what way?
Looking good for next week
12% rise in NAV over the half year. Share price will catch up in due course.
Perfectly respectable return, bought at just over £14 in March last year, roughly 66% up not counting divis. Still holding, may even add a few if incoming divis are available.
Net assets 3.4bn, 10 years ago 468m. I've ridden that all the way I'm glad to say.
On first glance, OK set of results. I find PCT's & Ben's stuff a long read, so I better get on with it.
Current this fund is enjoying 10% discount against an average discount of 5%. If you have no issue with its technology portfolio this is a strong buy
Polar Capital Technology Trust plc Interim Results for the six months ended 31 October 2020 on Friday, 11 December 2020.
A copy of the analysts presentation will be made available on the Company's website www.polarcapitaltechnologytrust.co.uk from 7.30am on the day of announcement.
Hate to say it but, in terms of technology stocks, the UK and Europe have a long way to go to catch up with the US and Asia. In my view, as a theme, technology has much mileage. But I keep coming back to the same problem. Many of the London-listed tech stocks seem to offer less growth potential than the foreign tech giants.
It was Jim Slater who famously said something to the effect that elephants don’t jump when referring to the growth prospects of large companies. But that was in the pre-internet days. Companies such as Apple have global markets and so the issue of scale may have to be viewed differently.
For me, it really comes down to how best to access the technology sector. I am not keen on passive investing and I’m quite wary of the ETF structure and how it will hold up in a real market crash. While some of these technology companies are so big and complex, they really require exhaustive and specialist research. In my opinion, the closed-ended active investment approach makes sense. The structure has stood the test of time while it also takes the wrong type of pressure off of fund managers. They are not compelled to sell in a falling market due to redemptions. And, of course, it’s not passive - I don’t want exposure to a stock simply based upon its market capitalisation.
But then it gets tricky. There are simply so many funds with overlapping holdings. For sure, Polar has performed well over a 10-year period but so have many others. Its costs are on the high side and it’s very dependent on a handful of US tech giants continuing to perform well: Some 70% of its holdings are from the US & Canada. And sitting in the back of my mind is the thought of a major attack on what are often near-monopolies. Will they be forced to break-up? Or will some left-field technological innovations knock them off their perches? Overall, big tech seems to be a very crowded trade. But it’s difficult to envisage a fragmentation of some of these businesses. There’s something about the Apple ecosystem and Facebook’s scale and depth that makes it difficult for new entrants.
At the moment, I’m not an investor in Polar but it’s certainly on my radar.
50% up in 6 months, wondering whether to top slice
Just picked up 780 of these at 14.17, hope it's lost most of what it's going to.
up steadily now after recent correction fall
Apple results hitting this - it's a big part of the portfolio. Shame, because without Apple, it looks very attractive.
In terms of positives, relative performance was generated by underweight PC exposure, the decision to retain some liquidity ahead of third quarter earnings season and a number of strong individual stock performances including Ariba, Kenexa, Springsoft and OPNET, all of which were acquired during the period for premiums that ranged between 19-42%. Rogoff added that the market outlook for economic recovery remained fragile. "While we acknowledge that there may be some additional downside risk to 2013 estimates, we believe this is likely to be modest and strongly disagree with the view that the current earnings cycle may have played out. In our experience, the third quarter has always been an awkward seasonal period -especially for technology earnings- even without the added distraction of the Olympics and leadership change in three of the world's most important economies." Polar Capital Technology Trust has a market capitalisation of £470.82m