The Technology Cycle

Growing Our Investors’ Assets Since 1996

Polar Capital Technology Trust plc provides investors with access to the potential of companies in the global technology sector.

Managed by a team of dedicated technology specialists, the Company has grown to become a leading European investor with a multi-cycle track record – a result of the managers’ approach to investing, with the ability to spot developing technology trends early on and to invest in those companies best placed to exploit them.

2019: Software Containerisation: Building blocks for the digital economy

Disruption is the zeitgeist of the current technology cycle and numerous industries are reinventing themselves through digital transformation to avoid becoming irrelevant, obsolete or disintermediated.

Last year we discussed how digital transformation is no longer a ‘nice to have’ but is most definitely a ‘business imperative’. Twelve months on and we have seen increased IT spending on digital transformation and budgets allocated away from legacy areas towards next-generation software that is providing valuable building blocks for the digital economy.

2018: Technology Disruption: Recoding the corporate DNA

Twenty years after the dawn of the commercial internet, nearly every sector is now being challenged, improved or replaced by disruptive technology.

Digital transformation is no longer a ‘nice to have’ but is most definitely a ‘business imperative’ as companies respond to a new generation of customers, partners and suppliers whose everyday lives are dominated by technology. They demand the same seamless, real-time transaction experience irrespective of the environment they are that are just starting to be realised by next-generation businesses and emerging technologies.

2017: Infinite Possibilities: Smart machines and the rise of AI

After years in the wilderness it is becoming increasingly clear that Artificial Intelligence (AI) and Machine Learning (ML) are emerging as the next great technology platforms.

We are fascinated by the potential for automation and robotics as the evolution of advanced components such as machine vision, sensors and reduction gears have made highly accurate and repeatable movement possible. The robotics opportunity has also been advanced by e-commerce which is forcing a rethink of the whole supply chain while cobots (robots with enhanced safety control functions) are now able to operate alongside humans in a production line without a safety barrier. This back-end infrastructure designed to garner insight from Big Data has captured the imagination of Silicon Valley and Wall Street alike.

2016: Into the Eye of the Storm: Cloud computing makes landfall

2015 was the ‘end of the beginning for cloud computing and the beginning of the end for traditional IT’.

With c.15% of IT workloads now in public clouds, we expect Cloud adoption to accelerate, and tough times ahead for most enterprise incumbents. To date, disruption has been limited to the absence of growth (as every incremental IT Dollar has gravitated to the public cloud) and some pricing pressure. The next wave will be driven by workload migration, which Gartner believe will see more than $1tr of IT spending shift to new categories as a result of cloud computing by 2020.

As technology companies reinvent industries, create new markets and empower customers, the CEO of GM put it, ‘we’re going to see more disruption in the next 5–10 years than we’ve seen in the last fifty’. This captures perfectly our excitement about the new cycle and is likely to prove valid across most industries now that the Cloud has made landfall.

Information obtained from third party sources has not been independently verified by Polar Capital.
Polar Capital makes no express or implied warranties or representations with respect to such data of its originality, accuracy, completeness, merchantability or fitness for purpose.

2015: Digital Disruption: Transforming the World Bit by Bit

All of the industry's incremental growth is being captured by new technologies and vendors.

Indeed, although there is no denying that most growth-challenged incumbents have become better stewards of capital, this has done nothing to alter our view that enterprise computing is looking increasingly anachronistic.

The new technology cycle continues to be underpinned by three core themes: Internet infrastructure, broadband/Internet applications and mobility, with ‘big data’ playing a galvanising role.

Certainly cloud computing appears to be gathering momentum with companies said to have spent $56.6bn in 2014, while the cloud market is forecast to grow at a CAGR of 22.8% until 2018, six times faster than the overall IT industry.*

We expect a number of exciting emerging themes to become more significant – both in terms of their real-world and portfolio importance over the coming years. These include 3D printing, augmented and virtual reality, drones, electric and autonomous vehicles, the Internet of Things, mobile/connected health, personalised medicine, renewable energy and wearable computing.

* Source: IDC, November 2014.

2014: Redefining knowledge, reimagining industries

Fuelled by smartphone adoption, the Internet is becoming pervasive allowing the technology sector to ‘reimagine’ other industries.

As the new technology cycle enters a second, more pernicious stage, disruptive technologies will begin to substitute, rather than merely complement existing ones. While this may result in a more challenging backdrop for incumbents, next-generation companies have much to gain, and little to lose from new cycle disruption.

The impact of cloud computing cannot be underestimated. Just as the printing press made the ‘cumulative advance of knowledge’ possible, the ability to question vast repositories of digital data in real-time via mobile devices has made librarians of us all. Digital content, collapsing bandwidth costs and proliferation of mobile devices are changing how we consume media while on-demand services have accelerated the trend towards hyper-personalisation.

Anticipating such change and its potential impact across sectors, requires an awareness of world-wide trends, historic parallels and domain expertise.

2013: The New Cycle Forges Ahead: Extracting Value in the ‘Big Data’ Era

The potential to extract value from the vast amount of untapped data in today’s world has led some people to describe data as the next natural resource.

Just as finding new solutions to process today’s datasets offers potential high rewards to entrepreneurs, so too does identifying those companies best placed to prosper in the new technology cycle

The huge datasets created by smartphones and other devices are too big to manage using traditional means, resulting in the development of complex new data-mining solutions.

The technology universe is vast – finding the best technology companies to invest in can also be a daunting task. Our experienced, specialist investment team has a deep understanding of the trends influencing this industry and are well-placed to unearth the most attractive opportunities. The portfolio’s track record since inception is testament to this.

2012: New Cycle: Cleared for Take-Off

Dramatic improvements in cost and speed, together with the adoption of mobile computing, have made the internet as ubiquitous as air travel.

PCT invests a large proportion of its assets in companies involved in the explosion of internet-related technologies.

Technological improvements have had a dramatic impact on the cost/performance equation of both aviation and the Internet, by broadening their appeal. New applications in avionics not only increased the speed, reliability and comfort, but also lowered costs, leading to air travel as we know it.

Echoing these advancements in the aviation market, plentiful bandwidth and cheap computing have presaged the development of a number of key Internet applications – these are likely to provide the best investment opportunities.

But this is not the only place where prospects may lie:  we can invest in any attractive company that develops or supplies technological solutions as a core part of its business model. This means our investors  gain exposure to the growth potential of areas as diverse as information, media, communications, healthcare, the environment and renewable energy. 

2011: Changing the Landscape of Computing: Public Clouds and the Mass Production of IT


Just as the skyscraper ultimately changed the skyline, so we expect the cloud - and the mass production model it delivers - to transform the IT industry beyond recognition over the coming years.

Yet this is not necessarily good news for the best-known technology companies. PCT looks beyond the major players investing in companies with the highest growth potential – however big they are, and wherever they are based.

Public clouds deliver computing at vastly lower prices due to their scale and adoption of technologies which enable much higher usage rates than most enterprises can achieve. With computing needs growing inexorably in this era of austerity, companies and consumers are increasingly choosing cheaper technologies and vendors at the expense of better-known incumbents.

Technology indices are heavily skewed towards the biggest, best-known companies, but these do not necessarily present the most promising investment potential. Benchmark investing can be a value trap. PCT employs a non-benchmark unconstrained approach to investing, giving the freedom to invest in the companies that we believe are the new technology challengers.

2010: Harnessing the Potential of the New Technology Cycle

We’re in the midst of a new technology cycle, driven by cloud computing, internet applications and mobility.

PCT seeks to capitalise on such cycles, harnessing potential growth and exposure to exciting emerging themes by investing in companies believed to have the highest growth potential from across the global technology spectrum.

The technology industry is one of the most vibrant, dynamic and fastest-growing areas of the global economy, with companies in this sector offering the potential for substantially faster earnings growth than the broader market. This growth potential reflects the accelerating rate of adoption of new technologies which are transforming the competitive position of companies – and entire economies –and fuelling a major secular increase in technology spending.

PCT aims to maximise the long-term growth of shareholders’ capital. The manager’s approach enables them to fully harness the investment potential within emerging technology themes.  We believe the companies we invest in will be at the forefront of technological innovation and have strong potential to rise in value. 

Latest Publications

Monthly Commentary

Global equities rallied in April and the MSCI All Country World Index gained 9.1%. The S&P 500 surged 11.2%, closing out its best month in local terms since 1987, while the DJ Euro Stoxx 600 lagged, rising 4.9% (all returns in sterling terms)....

Ben Rogoff
Technology Director and Lead Manager

Read more

Important Legal Information

Launched in 1996, Polar Capital Technology Trust plc (“PCT”) has grown to become a leading European investor with a multi-cycle track record. Managed by a team of dedicated technology specialists, the PCT aims to maximise long-term capital growth by investing in a diversified portfolio of technology companies from around the world. The managers’ core belief in rigorous fundamental analysis, and being unconstrained by not following a benchmark, enables PCT to deliver global equity market outperformance through exposure to a universe of over 3,000 companies.

By clicking accept, you agree to the terms and conditions detailed below.

The information contained within this website is issued by Polar Capital Technology Trust plc (‘Polar Capital Technology Trust’) and is provided for reference purposes only. Nothing herein is intended to be construed as an offer, invitation or inducement to engage in investment activity, or investment advice or recommendation, in relation to the shares of Polar Capital Technology Trust and should not be relied upon as such by any person. Prospective investors should take advice from their financial or other professional advisers before making any investment decision.

The information contained within this website is intended to be used for reference purposes only by persons in the UK. Nothing on this website is directed at any person outside the UK where the publication or availability of such information is prohibited or restricted. In particular, the information contained within this website is not intended for, and must not be accessed by or distributed or disseminated to, directly or indirectly, in whole or in part, persons resident or physically present in the United States of America, including its territories and possessions, any state of the United States and the District of Columbia (together, the "United States"), Canada, Australia or Japan, and does not constitute an offer to sell or the solicitation of an offer to buy or acquire, any securities of Polar Capital Technology Trust in the United States, Canada, Australia or Japan. Polar Capital Technology Trust is an Alternative Investment Fund (“AIF”) under the Alternative Investment Fund Managers Directive 2011/61/EU (“AIFMD”) managed by Polar Capital LLP the appointed Alternative Investment Fund Manager (“AIFM”). In relation to each member state of the EEA (each a “Member State”) which has implemented the AIFMD, shares may only be offered or placed in a Member State to the extent that a fund is permitted to be marketed to professional investors in the relevant Member State in accordance with AIFMD or as the shares may otherwise be lawfully offered or placed in that Member State (including at the initiative of the investor). As at the date of this document, Polar Capital Technology Trust have been approved, notified or registered in accordance with the AIFMD for marketing to professional investors in any member state of the EEA.

The securities of Polar Capital Technology Trust referred to on this website (the "Securities") have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act") and may not be offered or sold in or into the United States or to, or for the account or benefit of, US persons (as defined in Regulation S under the Securities Act) absent registration under the Securities Act or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. Polar Capital Technology Trust will not be registered under the U.S. Investment Company Act of 1940, as amended, and investors in the Securities will not be entitled to the protections of that Act.

Polar Capital Technology Trust is managed by Polar Capital LLP; Polar Capital LLP is not responsible for the content or accuracy of any information contained within this website.

If you are unsure about the meaning of any information provided on this website, please consult your financial or other professional adviser. Polar Capital Technology Trust cannot and does not offer investment advice.

General Risk Warning:

Please remember that past performance of an investment is not necessarily a guide to future performance. The value of an investment and the income from it can fall as well as rise as a result of market and currency fluctuations and you may not get back the amount originally invested. The market value of the shares of Polar Capital Technology Trust may not reflect the underlying net asset value of the investments held by Polar Capital Technology Trust. Polar Capital Technology Trust is able to borrow to raise further funds for investment purposes if the fund manager and the board of directors consider that it may be commercially advantageous to do so. This is generally described as “gearing”. An investment trust which has made investments as a result of gearing may have a more volatile share price as a result; gearing can increase shareholder returns in rising markets but conversely can increase the extent to which the value of the funds attributable to shareholders decreases in falling markets. Tax assumptions may change if the law changes, and the value of tax relief (if any) will depend upon your individual circumstances. Investors should consult their own tax advisers in order to understand any applicable tax consequences.

Disclaimer:

Polar Capital Technology Trust believes that the information displayed on this website is accurate as at the date of publication, but we do not guarantee the accuracy of any information or that it is up to date as at the time of reading and we disclaim all representations and warranties, whether express or implied, to the extent permitted by applicable law and regulation. Further, the information displayed may be amended by us at any time and without notice. By continuing to use this website, you agree to the exclusion by us, to the extent permitted by applicable law and regulation, of any and all liability for any direct, indirect, punitive, consequential, incidental, special or other damages, including, without limitation, loss of profits, revenue or data arising out of or relating to your use of and our provision of this website and its content. If you are dissatisfied with any aspect of this website, or of its contents, your sole and exclusive remedy is to discontinue use of this website.

PRIVACY POLICY

Polar Capital Technology Trust is committed to preserving the privacy of all visitors to its website (“Website”).

By Accessing the Polar Capital Technology Trust website, personal data relating to you may be collected, processed and recorded by us in accordance with the GDPR and in accordance with any relevant legislative changes, these Terms of Use and our Privacy Policy.

Please access the Privacy Notice on the website to understand how we use and protect the information that you provide to us.

By accessing this website, you consent to the collection, use and transfer of your information under the terms of this Privacy Policy and the Terms of Use of this Website. 

Use of this site is subject to our site disclaimer and legal statement.