Polar Cap Tech posts modest shortfall in performance

The relative performance of specialist investment management company Polar Capital Technology Trust fell slightly short of the benchmark with the net asset value per share falling 5.6 per cent in the six months to October 31st 2012.

The relative performance of specialist investment management company Polar Capital Technology Trust fell slightly short of the benchmark with the net asset value per share falling 5.6 per cent in the six months to October 31st 2012.

In the FTSE 250-listed company's half yearly results, published on Monday morning, a number of factors were outlined as underlying reasons for the modest shortfall.

Ben Rogoff, investment manager at Polar Capital Technology Trust, commented: "The performance of small-caps was not the primary cause of this modest shortfall as they fell broadly in-line with large-caps over the period, as measured by the Russell 1000 and 2000 technology indices respectively. Instead, the portfolio was negatively impacted by its underweight position in Apple -which outperformed during the period-, poor returns from communication stocks due to continued weakness in service provider capital spending while semiconductor stocks bore the brunt of weaker economic trends and a contracting PC market."

In terms of positives, relative performance was generated by underweight PC exposure, the decision to retain some liquidity ahead of third quarter earnings season and a number of strong individual stock performances including Ariba, Kenexa, Springsoft and OPNET, all of which were acquired during the period for premiums that ranged between 19-42%.

Rogoff added that the market outlook for economic recovery remained fragile. "While we acknowledge that there may be some additional downside risk to 2013 estimates, we believe this is likely to be modest and strongly disagree with the view that the current earnings cycle may have played out. In our experience, the third quarter has always been an awkward seasonal period -especially for technology earnings- even without the added distraction of the Olympics and leadership change in three of the world's most important economies."

Polar Capital Technology Trust has a market capitalisation of £470.82m

MF

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

A simple way to profit from the next big trend change in the markets
Investment strategy

A simple way to profit from the next big trend change in the markets

Change is coming to the markets as the tech-stock bull market of the 2010s is replaced by a new cycle of rising commodity prices. John Stepek explains…
14 Jan 2021
Forget austerity – governments and central banks have no intention of cutting back
Global Economy

Forget austerity – governments and central banks have no intention of cutting back

Once the pandemic is over will we return to an era of austerity to pay for all the stimulus? Not likely, says John Stepek. The money will continue to …
15 Jan 2021
Here’s why markets have shrugged off the US political turmoil
Investment strategy

Here’s why markets have shrugged off the US political turmoil

Despite all the current political shenanigans in the US, markets couldn’t seem to care less. John Stepek explains why, and what it means for your mone…
7 Jan 2021
Free 6 issue trial then continue to