Hello and a very warm welcome back to our insider interview series. I'm Dave Baxter here at II, and today I'm joined by Ben Rogoff, lead fund manager on the Polar Capital Technology Investment Trust. Ben, many thanks for joining today.
The trust has enjoyed some really stellar returns, both in absolute terms and versus the competition, in the last year or so. What has driven that, and would you expect that to continue further?
Well, it has been a very good period for the trust and for the tech sector generally, but most importantly for the AI story, which has just continued to make huge gains. Again, when you look at the performance of 2026 to date, a very strong first half of the calendar year, because we've seen the agentic part of the AI story take off. And so if we went back and looked at the sort of short, brief, potted history of the AI story, we're kind of four years old. The first three and a bit years were spent basically having to argue that this was going to be really important, and this is why people were investing, and there were going to be great returns and products down the road, but those things didn't exist. The products were inferior or imperfect. There was really very little in the form of revenues to talk of. And then in 2026 we've seen the explosion of revenues at the frontier labs at Anthropic, OpenAI. We've seen continued growth in capex, and we've really started to see the models get to levels where you can see the actual revenues coming from coding and from other use cases that we're seeing. And now more recently, the sort of excitement around agentic AI, and that's resulted in, as I say, a kind of reappraisal of the AI trade and a very strong period of returns for stocks that are exposed to that theme.
We have probably more exposure to the AI theme than most. We describe ourselves as AI maximalists, and we've really been of that view now for three and a half years. How do I feel about it? Well, I'm obviously really pleased that we've, so far at least, the positioning of the trust has allowed us to capture a good portion of the returns. Look, everyone knows that past performance isn't a guide to future performance; it's worth just repeating that. Since the summer, actually, there's been quite a lot of buffeting, and I think that investors, again, should be aware that in new cycles that's typically what happens, because we're talking about something that's going to happen, or at least the revenues have arrived, but the real promise of AI remains to be seen.
And as a result of that, and because of that uncertainty and that time horizon, there's going to be more buffeting along the way. The way I like to describe it is: you know, the faster you travel, the more bumps you get on the way, the more turbulence you should expect. And I think that's where we are. Going forwards, we're still very positive about AI. I think in the end, outside of that volatility — and again, I can't extrapolate past performance — but what I can say is that the growth profiles of the companies we're investing in look good. I think there's a general level of overall skepticism about AI that is healthy. We're not at a point, in my opinion, that we were in the late 90s when everyone's in the trade. We're not putting on what we would describe as peak multiples, peak PEs on peak earnings, and there's a lot of strong earnings growth that we've seen in the portfolio, but the market has been actually fading the forward PEs as the earnings have gone up. And I think that reflects a sort of general level of skepticism that an industry that's gone from nothing to a trillion dollars of capex can continue to grow. We think it can. We think that models continue to get better, they open new market opportunities, and we're not really even imagining yet what AI might achieve once we start to see real evidence of non-human scaling.
What stands out to me is that the trust has much higher exposure to Asia than many of its rivals. But interestingly, you still do have around 67% of the portfolio in the US. How do you expect that mix to shift over time?
No, it's a great question, and I think it just reflects this pro-AI portfolio that we've had in place, and really going to where we see the best opportunities to profit from that. You know, you reference South Korea; that's because it's a very memory-heavy market — Samsung, SK Hynix. We've also found some smaller names that I'm not going to share today because I'm really proud of them, and I don't know if others have found them. But the bottlenecks around materials, chemicals, bits and bobs that you need that you didn't need in the cloud world — many of the companies that dominate those small niche markets are in Asia. That's not to say you can't find great semiconductor companies in the US. Obviously, Nvidia is without peer, but we also have companies like AMD in very big positions. The semiconductor capital equipment industry — there's US names that are wild beatas, but there are also very interesting companies in Japan and elsewhere. So we're relatively agnostic. We just want to make sure that we find the best opportunity, perhaps a market share gainer, the best priced asset, but ultimately the right exposure to the bits of the market that we're excited by longer term or medium term.
Look, again, I think that there's a downward pressure on the US weighting that comes in the form of sort of AI disruption, because let's be honest, the US has been the dominant geography in a cloud-smartphone world, and I think that we're coming to the end of that cloud-smartphone world. We're in an AI era. That doesn't mean, however, that the US is going to lose. And if you look at where the frontier labs are, they're all in North America. So, you know, we bought SpaceX in the portfolio in a relatively modest shape. That's again a unique, non-fungible asset that is based in the States. As and when this IPO market more fully reopens and we get to refresh the US stocks, there is no reason why the US couldn't be 70 or 75% again of trust assets. But right now, absent SpaceX and a handful of other companies, we really haven't seen an IPO market with a kind of recharged, AI-native list of companies coming public. If that happens, there's very good reason to believe that we could rebuild the US, but in the absence of that, we will just continue to look for the best opportunities globally.
It's interesting that you mentioned SpaceX. You did kind of pounce on the shares when they IPOed earlier this year. You also mentioned OpenAI and Anthropic, and I suppose an interesting trend has been that companies have made many of their gains in the tech space while they've still been private. How tempted do you get to kind of hire a specialist and start investing in unlisted companies?
A couple of things. I love the word pounce, because that sounds like we're all at our desks poised. I mean, we'd obviously been doing a lot of work on SpaceX for quite a while. Look, I think it's just worth reminding people that the trust, since I've been managing it, has exclusively focused on listed companies. The reason we do that is because ultimately there's really nothing worse as a fund manager than being stuck in stocks you don't want to be involved in, and things in the tech sector change very, very rapidly. So we have a very different approach, a very different level of turnover. Again, 100% turnover for probably every year that I've managed the trust is unusual relative to perhaps other investment vehicles or other managers. So immediately being in a stock that doesn't trade will sit uncomfortably for us, given how active our investment process is — inherently active.
That isn't to say we're not aware of the company or that we're not doing the work. So we've met with SpaceX when it was private, and when we had the opportunity to invest in it, we did. And we've been meeting with OpenAI and Anthropic, as you would expect us to do. Again, we're a large team running a reasonable amount of money on behalf of people, and so we get access to companies before they're public. Should we be involved in them earlier? Well, obviously, when you look at what's likely to happen with Anthropic and OpenAI, and already has, of course, if you think about where these companies are raising money in private markets, obviously we would have loved to be participants in that. But I think in the end, you can't just rifle shoot in the private market. You have to commit a large amount of time, a large amount of resource to it, and also it's very much a shotgun approach. No one is going to allow you into a deal at the last minute in order to invest in a great business. You have to be there for the duration, through the corporate life cycle. You have to, I suppose, play the game, and that isn't where we think the best effort-to-output ratios are.
So we've been able to deliver — really delighted with the returns we've been able to deliver. We've been able to do that 100% in the public market. And when scenarios change, should the AI story change for the better or the worse, we can make changes to the portfolio that are unavailable to those that are in private companies. And one last thing, if I may: again, I think it's just worth reminding people that for every Anthropic and for every OpenAI — and again, I am a bit jealous that we don't own those stocks in the portfolio — there will be many other companies you've never heard of where the vintage of those years of private investment may have just gone sour, because those companies were interesting in a pre-AI world but are much less interesting today. And so we think that we're very happy with the investment universe that we have. We try to make the most of it. And yes, there will be days where we wish we could have been in a private company, but...
And then one last thing. SpaceX — you said we're insensitive or something. I think you said, to valuation...
