Overview

City View Image

Aim

Allianz Technology Trust PLC is a UK listed closed-end fund which aims to achieve long-term capital growth by investing principally in the equity securities of quoted technology companies on a worldwide basis with the aim of achieving long-term capital growth.

The Trust invests in mid to large technology companies. The portfolio is positioned to hold companies we expect to benefit from the continued growth in particular sub-sectors of technology, especially in companies that provide solutions to save money or enable companies to improve their relationships with customers and deliver revenue growth. It is also seeks to hold companies that will create shareholder value with the introduction of a new product or new technology. Over the past 20 years, this would include PC manufacturers, software, internet applications or consumer devices.

 

Trust History

The Trust was formed in December 1995 and re-launched by AllianzGI in 2007 for investors to gain exposure to quoted technology companies on a worldwide basis with the aim of achieving long-term capital growth. The Board appointed AllianzGI to manage the Trust’s assets from April 2007 based on the performance of AllianzGI’s US-based technology team, their experience and AllianzGI’s depth of expertise in the management of investment trusts.

Investment Rationale

1. Identify major trends ahead of the crowd: The Manager’s objective is to strive for superior long-term returns by identifying major trends ahead of the crowd and participating in stocks that have the potential to become tomorrow’s Microsoft, Cisco or Apple.

2. Concentrated portfolio: The Trust’s portfolio is concentrated in approximately 60 stocks, compared with the benchmark which has some 515 stocks.

3. Bias to overweight mid caps and underweight large caps: The Trust does not seek to ‘track’ the index and it is our policy to avoid too high an exposure to any single security. The portfolio tends to be overweight in high growth mid cap companies and underweight in mega cap companies.

4. Aim to capture the tremendous growth potential in Cloud computing and software as a service: Circa 20% of the portfolio is invested in companies associated with Cloud computing eg Amazon, Salesforce, Rackspace, Netsuite etc. We believe that Cloud computing is a development within the technology sector of a magnitude that only happens every 15 or 20 years

5. Seeking to capture total return potential within the portfolio: We believe that the large cap technology stocks are as cheap as ever in their history. Some of these companies have very high cash flow yields and hundreds of billions of dollars on their balance sheets. They are starting to offer reasonable yields from dividends and could potentially increase their dividends substantially.

6. Located in the heart of the world’s technology industry: The Manager continues to exploit the considerable benefits of being located in San Francisco and has close and regular contact with the growth companies that are identified for the portfolio. At least 35% of the Trust’s investments are locally based to the Manager in San Francisco and another 17% of the companies held in the portfolio are less than two hours away by plane.

7. Manager’s extensive experience: Walter Price, the Manager has almost 40 years experience investing in the technology sector, and he and the Team are widely regarded in their field.

Asset allocation
The fund managers do not target specific country or regional weightings and aim to invest in the most attractive technology shares on a global basis. The fund managers aim to identify the leading companies in emerging technology growth sub-sectors. The majority of the portfolio will comprise mid and large cap technology shares.
Risk Diversification
The Company aims to diversify risk and no holding in the portfolio will comprise more than 15% of the Company’s assets at the time of acquisition. The Company aims to diversify the portfolio across a range of technology sub-sectors.
Gearing
In normal market conditions gearing will not exceed 10% of net assets but may increase to 20%. The Company’s Articles of Association limit borrowing to one quarter of its called up share capital and reserves.
Liquidity
In normal market conditions the liquidity of the portfolio, that is the proportion of the Company’s net assets held in cash or liquid investments, will not exceed 15% of net assets but may be increased to a maximum of 30%.
Derivatives
In normal market conditions the liquidity of the portfolio, that is the proportion of the Company’s net assets held in cash or liquid investments, will not exceed 15% of net assets but may be increased to a maximum of 30%.
Foreign Currency
The Company does not currently hedge foreign currency exposure
Benchmark
Dow Jones World Technology Index Sterling Adjusted Total Return.
 
 

"The rise of the smartphone and tablet computer is illustrated by the explosive growth in the creation and sale of Apps. Apple alone has seen 85 billion Apps downloaded by its users, as of October 2014."

Walter Price
Fund Manager

> more...

"From entertainment to manufacturing, from business to the environment, from education to energy, technology has the ability to change lives on a global scale..."

Walter Price
Fund Manager

> more...

"Cloud computing could displace businesses like Oracle or SAP. Amazon, for example, is offering a service where you can buy time on their servers for very little money - attractive proposition for start-up companies."

Michael Seidenberg
Portfolio Analyst

> more...