US President Donald Trump’s state visit to the UK saw the UK government announce £150bn in US investment.
The visit saw high-profile backing from tech giants including Microsoft, Google, and Nvidia, highlighting a shared focus on artificial intelligence (AI), digital infrastructure, and future-facing industries. This wave of investment signals the growing strategic importance of innovation on both sides of the Atlantic.
From the rise of Artificial Intelligence (AI) and automation to breakthroughs in clean energy and digital infrastructure, the investment landscape and economy not only in the UK, but globally, could be reshaped by both huge investments.
For investors looking to tap into the potential of tomorrow’s world, identifying the winners early is key. But backing innovative, disruptive companies isn’t always straightforward. That’s where investment trusts can come in. Run by experienced managers, some investment trusts offer a way to access next-generation growth themes.
Here are three investment trusts that could be at the forefront of some of these trends. Each takes a different approach, but they all invest in innovators and enablers trying to shape the future.
This isn’t personal advice or a recommendation to invest. Remember all investments and any income they produce can fall as well as rise in value so you could get back less than you invest. If you’re not sure an investment is right for you, ask for financial advice.
3 next generation investment trusts
Investing in these trusts isn’t right for everyone. Investors should only invest if the trust’s objectives are aligned with their own, and there’s a specific need for the type of investment being made.
You should understand the specific risks of a trust before investing, and make sure any new investment forms part of a diversified portfolio. Investing in a single sector like technology or renewables is a higher-risk approach compared to a more diversified one. Investment trusts investing in a specific sector should usually only form a small part of an investment portfolio.
Investors should be aware that trusts can trade at a discount or premium to the net asset value (NAV). These trusts can use gearing to invest, which increases the gains in a rising market, though the reverse is also true, which makes it a higher-risk approach.
Polar Capital Technology Trust
The Polar Capital Technology Trust aims to grow investors’ money over time by investing in next generation technology leaders, which the trust’s managers believe have great long-term growth potential. They invest in technology companies around the world, including some from higher risk emerging markets.
The managers aim to invest in financially strong companies run by experienced management teams, rather than early-stage or blue-sky companies, though they do invest in some higher-risk small and medium-sized companies too. Each company must have the potential to benefit from a technology trend or growth theme.
All companies are subjected to an “AI lens”. The managers believe that AI is the next general-purpose technology, changing the way companies work.
AI is a broad category and includes companies enabling AI technology (like those making semiconductor chips or providing cloud computing services), AI beneficiaries (mainly technology companies) and AI adopters.
The flexibility to use derivatives can increase risk.
Greencoat UK Wind
The UK aims for a 95% clean electricity grid by 2030, with major expansions in offshore and onshore wind. It has pockets of land that are ideally suited to generating renewable energy, and removing complex planning rules could boost UK renewables and infrastructure.
The goal is also to enhance energy security by reducing reliance on volatile fossil fuel markets and creating a more affordable and sustainable energy system.
Greencoat UK Wind invests solely in operating onshore and offshore UK wind farms that are currently producing income.
It aims to pay investors a resilient annual dividend that increases in line with inflation as measured by RPI (Retail Price Index), while preserving the value of an investment. This means the majority of any returns will come in the form of income rather than capital growth.
At the time of writing, the trust offers an attractive yield of 9.54%, though as always yields vary and aren’t guaranteed.
Scottish Mortgage Investment Trust
Scottish Mortgage Investment Trust aims for long-term growth by investing in some of the stock market’s most exciting companies. It provides exposure to some of the most disruptive businesses around the world, investing in areas from AI to space exploration, and healthcare to transportation.
The trust’s managers aim to provide long-term funding and support for the companies and entrepreneurs building the future of our economy. And this patient approach is well suited to investing in private unquoted companies (those not listed on the stock market).
The trust can invest up to 30% of its assets in these unquoted companies (measured at the time of investment).
Investors should be aware that investment in unquoted companies is higher risk, and they can be considerably less liquid (more difficult to buy and sell) than those traded on established stock exchanges. The managers can invest in derivatives too, which if used also adds risk.
Annual percentage growth
Aug 2020 To Aug 2021 | Aug 2021 To Aug 2022 | Aug 2022 To Aug 2023 | Aug 2023 To Aug 2024 | Aug 2024 To Aug 2025 | |
|---|---|---|---|---|---|
Polar Capital Technology Trust plc | 17.70 | -21.09 | 11.88 | 30.97 | 34.46 |
AIC Investment Trust - Technology & Technology Innovation | N/A | N/A | 4.60 | 13.64 | 11.73 |
Greencoat UK Wind PLC | -4.36 | 33.20 | -9.28 | 7.95 | -16.03 |
AIC Investment Trust - Renewable Energy Infrastructure | 2.85 | 16.38 | -21.77 | -6.28 | -1.95 |
Scottish Mortgage Investment Trust PLC | 42.81 | -40.93 | -14.42 | 21.39 | 33.21 |
AIC Investment Trust - Global | 27.82 | -13.73 | 2.83 | 21.38 | 12.68 |