Polar Capital Technology Trust Reports 102% NAV Growth in Stellar Fiscal Year

Polar Capital Technology Trust FY2026 results: 102.2% NAV growth and a big benchmark beat

Polar Capital Technology Trust has delivered a monster set of annual results for the year to 30 April 2026. Net asset value, or NAV, per share – basically the value of the underlying portfolio per share – jumped 102.2% to 657.41p from 325.20p. That comfortably beat its benchmark, the Dow Jones Global Technology Index, which rose 55.0% in sterling terms.

The share price did even better, up 109.0% to 603.00p from 288.50p. That tells you two things straight away: the portfolio had a superb year, and investors became more willing to pay up for it.

Key number | FY2026 | FY2025
NAV per share | 657.41p | 325.20p
NAV total return change | 102.2% | 3.1%
Benchmark return | 55.0% | 5.1%
Share price | 603.00p | 288.50p
Share price return | 109.0% | (1.2%)
Discount to NAV | 8.3% | 11.3%
Total net assets | £7.3 billion | £3.8 billion
Ongoing charges ratio | 0.69% | 0.77%

In plain English, this was an exceptional year. The chair called it the best relative year for the company in at least two decades, and based on the figures in the RNS that looks fair.

Why Polar Capital Technology Trust performed so strongly: AI and semiconductor exposure did the heavy lifting

The big driver was artificial intelligence. The manager described the portfolio as having an “AI maximalist” positioning, which is a pretty blunt way of saying it leaned hard into the parts of tech most exposed to the AI spending boom.

That worked brilliantly. The trust made major gains from semiconductors, memory, storage, networking and data centre power and cooling – exactly the bits of the supply chain that benefit when hyperscalers and AI labs spend aggressively on infrastructure.

The company highlighted strong contributions from holdings including SanDisk, SK Hynix, Seagate Technology, Western Digital, Advanced Micro Devices, TSMC, Lumentum, Ciena and Corning. It also got a boost from being underweight or not owning several big software names that struggled as investors worried AI could damage their long-term business models.

That is the really important point here. This was not just a lucky Nvidia trade. In fact, the trust said its underweight position in Nvidia detracted slightly from relative performance. The outperformance came from a broader call that AI would spread benefits across the hardware and infrastructure stack, while software and some internet businesses would find life tougher. That call was spot on in FY2026.

Portfolio positioning shifted away from benchmark-heavy US exposure

The portfolio was also less US-heavy than the benchmark. US and Canada were 62.9% of net assets against a benchmark weighting of 79.9%. Asia Pacific ex-Japan was 17.9%, and Japan was 6.9%, both well above benchmark weights.

That matters because some of the strongest winners were in Asia, especially semiconductor and electronics supply chain names. It shows the manager was not simply hugging the index – this was active management in the proper sense.

Discount narrowing and buybacks: why this matters for Polar Capital Technology Trust shareholders

Investment trusts have a quirk that open-ended funds do not: their shares can trade below the value of the underlying assets. That gap is called the discount. In this case, the discount narrowed from 11.3% to 8.3% over the year.

That is good news for shareholders, because it means the market price moved closer to the underlying portfolio value. The board also helped by buying back 55,803,823 shares during the year at an average price of 411.8p and an average discount of 10.1% to NAV. After the year end, it bought back another 7,051,976 shares up to 2 July 2026.

Buybacks at a discount can be value-enhancing for remaining shareholders. In simple terms, the trust is buying £1 of assets for less than £1, which can lift NAV per share over time.

Fee cuts have quietly improved the investment case

Another positive is cost control. The revised fee structure kicked in from 1 May 2025, with the performance fee removed entirely and a two-tier base fee introduced: 0.75% on NAV up to and including £2 billion, and 0.60% above £2 billion.

The result is that the ongoing charges ratio fell to 0.69% from 0.77%. For a specialist global technology trust, that is a meaningful improvement. Lower fees do not grab headlines like a 102% NAV gain, but over the long run they really matter.

Polar Capital Technology Trust balance sheet, cash position and dividend policy

The balance sheet looks strong. Total net assets nearly doubled to £7.3 billion, and the company ended the year with £583.6 million of cash and cash equivalents. It described itself as ungeared, meaning it was not net borrowed, and said it had a net cash position of 6.2% at the year end.

That said, there is still a JPY 15 billion fixed-rate loan in place, due for repayment in September 2027. The company said repayment would total around £70.4 million, equivalent to about 1% of NAV at the year end, so it does not look alarming.

Income investors should note this remains a capital growth story, not a dividend one. Revenue return was still negative after expenses, the revenue reserve remains in deficit, and the board is not recommending a dividend.

What looks positive and what looks risky after these results

The positives are obvious. Performance was outstanding, costs are improving, the discount narrowed, and the manager’s long-term record remains strong. The trust also has real scale now, with total net assets of £7.3 billion, which can help on liquidity and cost efficiency.

But there are risks too. The manager is very clear that the portfolio is built around a strong AI view. That has worked spectacularly, but it also means this is not a cautious, middle-of-the-road trust. If AI spending slows, if semiconductor demand disappoints, or if markets rotate sharply again, returns could be more volatile than a broad global fund.

Currency is another one to watch. A large chunk of the assets are in US dollars, and the board flagged that continued dollar weakness could be a near-term headwind. Geopolitics, stretched valuations and the possibility of AI monetisation not keeping up with infrastructure spending were also flagged as risks.

I would add one more practical point. A 102.2% NAV return is fantastic, but it also sets a very high bar for what comes next. Investors should not assume this sort of performance is normal.

My take on the Polar Capital Technology Trust FY2026 annual results

This is a very strong RNS. Not just good – genuinely standout. Polar Capital Technology Trust massively outperformed its benchmark, did it with a clear and differentiated investment stance, and backed that up with better fee terms and active discount management.

The flip side is that the trust is making a big call on where the AI value will sit. Right now, that call looks smart and well-timed. For retail investors, the takeaway is simple: this is a high-conviction global tech trust that has just had a stellar year, but it is best suited to people who can handle volatility and who believe the AI buildout still has further to run.

If you want income, this is not the one. If you want a cautious tech tracker, this is not that either. But if you want an actively managed technology investment trust that has just shown exactly why active management can matter, these results make a strong case.