Polar Cap Tech remains strong despite risks

Polar Capital Technology Trust posted its preliminary results for the year to 30 April on Tuesday, with total net assets growing 56.3% to £1.25bn, and net assets per ordinary share increasing 56.% to 945.39p.

The FTSE 250 firm closed off the year at a price of 947p per ordinary share, up 67.3%, with a 0.2% premium of the share price to net asset value, compared to the 6.5% discount seen last year.

“Global equity markets continue to grind upwards supported by modest growth, low inflation, ultra low interest rates, and a lack of highly liquid alternatives to earn a return on cash,” said chairman Michael Moule.

“As you would expect from a mature eight year old bull market, valuations look a bit stretched but still provide value relative to the return available on government bonds.

“In most cases, shareholders are kept sweet by dividend increases and share buybacks.”

Moule said even the “relative political earthquakes” of Brexit and Trump have been digested and construed as positives.

“So I frankly have no idea when we will see another recession or global financial catastrophe and, with large and growing deficits and debt levels in most developed economies, politicians and central bankers are keen to keep interest rates and bond yields as low as possible.

“The technology sector continues to deliver both superior sales and earnings growth without the need for vast capital expenditure so the sector continues to be popular with general investors.”