Update research from QuotedDataSource: RNS
Polar Capital Technology - Update research from QuotedData
8th December 2022
Jockeying for position
Weakened risk appetite among investors as macroeconomic headwinds persist has seen the technology sector suffer. As investors retreated to the sector titans (stocks such as Microsoft and Apple), Polar Capital Technology's (PCT's) underweight position in these companies has seen it underperform its benchmark over the 12 months to the end of November, while its exposure to 'next-generation' software companies has also been a source of underperformance versus legacy stocks as IT budgets are disproportionately squeezed.
PCT's manager, Ben Rogoff, is undeterred by this and plans to take advantage of valuation compression to double-down on its 'next-generation' thematic position and will continue the portfolio's pivot towards secular growth stocks (such as software companies), focusing on companies with strong balance sheets that can perform well in a more challenging backdrop.
Recent inflation data and a more dovish central bank rhetoric suggests that peak inflation may have been hit, which should result in an easing of interest rate expectations and a raising of investor appetite for technology stocks.
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