Over the last 10 calendar years, the FTSE 100 index has returned a little under 9% a year when dividends are included. That’s not a bad return.
However, investors could have done far better with an investment trust that’s a constituent of the index. Over the last decade, this particular product has returned about 25% per year.
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A brilliant long-term investment
The one I’m referring to is the Polar Capital Technology Trust (LSE: PCT). This is a tech stock-focused product run by London-based investment manager firm Polar Capital.
A decade ago, it was trading for around 55p. Today however, it has a share price of around 503p.
That means anyone who bought 10 years ago and held for the long term has made around nine times their money. That’s an absolutely brilliant return – it could have turned a £5,000 investment into around £45,000.
Worth a look in 2026?
Is this trust worth considering today? I think so.
The table below shows the top 10 holdings at the end of 2025. What I like about that list is that there’s a lot of exposure to chip (Nvidia, Broadcom, AMD, TSMC) and chip manufacturing equipment stocks (Lam Research, KLA).
I reckon these stocks will do well in the years ahead. They should benefit as companies like Amazon, Alphabet, and Meta spend heavily on AI infrastructure and the world becomes more digital.
Digging deeper into the holdings, there were some really interesting names in the portfolio at the end of October (the latest full portfolio holdings data available). Some examples here include taser maker Axon Enterprise, AI powerhouse Palantir, data centre cooling specialist Vertiv, and fast-growing investment platform Robinhood Markets.
Of course, there’s a chance that these names have been sold since the end of October. But it shows you the types of innovative companies in the portfolio.
One other thing to like about this trust is that it currently trades at a near-10% discount to its net asset value (NAV). In other words, anyone buying now is getting access to a basket of high-quality tech stocks at a significant discount.
Risks and fees
Of course, there are plenty of risks to consider with this product. One is the sector focus.
While the portfolio is well diversified at stock level, it’s not very diversified at sector level (although there are a few stocks in the portfolio that aren’t pure tech stocks). So, if the tech sector was to have a meltdown (or even just go nowhere), this trust would most likely underperform.
The significant exposure to chips is another risk to consider. This area of technology has historically been volatile.
In terms of fees, ongoing charges are 0.77%. That’s relatively high.
There are some other products in this space that have lower fees. An example here is the iShares S&P 500 Information Technology Sector UCITS ETF (its fees are just 0.15%).
Overall though, I see quite a bit of appeal in this product. I believe it’s worth considering for a diversified portfolio.
This story originally appeared on Motley Fool
