Performance, Commentary & Portfolio

Fund Manager’s Review

Allianz Technology Trust’s Net Asset Value (NAV) total return was 8.72% in June, compared to the Dow Jones World Technology Index return of 7.55% in GBP.

Equities initially sold off on news of Israeli strikes against Iran, but the risk-on mood returned after Tehran’s restrained response to United States strikes which paved the way for a de-escalation in tensions and a ceasefire between Israel and Iran appeared to take hold. Within technology, semiconductors rallied on renewed optimism for artificial intelligence (AI)-related applications, followed closely by gains in the entertainment industry, while technology hardware stocks were only modestly positive.

Monthly performance outpaced the benchmark on a relative basis thanks to a combination of favourable industry allocation impacts and stock selection. Performance was led by exposure to capital markets, an underweight to technology hardware and bottom-up picks in semiconductors, while short-term stock selection in software detracted from results.

Contributors

Shares of financial services platform Robinhood Markets, Inc. continued to notch higher due to expectations of strong execution, led by the company’s leadership position and it being a beneficiary of a high level of customer loyalty and engagement, particularly from younger demographic clients. We incrementally added to our position during the month due to its high alpha potential (alpha is a measure of an investment’s excess return compared to a benchmark).

A below-benchmark allocation to iPhone and personal computer maker Apple Inc., contributed to relative results as shares were flat due to continued uncertainty related to macroeconomic policies and their specific impact on the company, as well as a delay in their AI progress. We incrementally trimmed our exposure to the stock in favour of companies which we believe have better near-term alpha catalysts

An active overweight allocation to Micron Technology, Inc., an industry leader in innovative memory and storage solutions, aided results as the company’s share price rallied due to a favourable industry outlook combined with record revenues and strong demand for AI-related applications.

Our above-benchmark position in chipmaker Advanced Micro Device, Inc. and below- benchmark weight in search engine and advertisement giant Alphabet Inc. also contributed to relative performance in June.

Detractors

The portfolio’s structural below-benchmark allocation, given our max position size limitations, to graphics processing and related networking leader NVIDIA Corp. offset results as the stock advanced thanks to an improvement in chip and AI-related outlook. The stock was the largest holding in the portfolio at the end of the month due to its leadership position, strong management team and favourable investor sentiment.

Our avoidance of Oracle Corp., a leading supplier of software solutions for enterprise information management, offset relative results as the company rallied following upside earnings results and expectations of an increase in cloud infrastructure sales.

The portfolio’s position in cloud data management and data security provider Rubrik, Inc. offset performance as the stock price moderated following upside earnings results and an increase in annual guidance, with investors choosing to lock in profits following outsized gains over the last several months. We continue to hold the stock as we believe it has an encouraging risk versus reward profile as a portfolio holding.

Our active exposure to Atlassian Corp., a designer and developer of enterprise software platform for project management, and Okta Inc. a leading independent identity management platform for enterprise clients, also detracted from relative results.

New buys and sells 

Turnover in June was used to incrementally improve the risk versus reward profile of the portfolio. We newly purchased shares of stablecoin and cryptocurrency exchange Coinbase Global Inc., given its secular growth potential from global adoption of stablecoins, new product initiatives and the company’s leadership position. We also added to two technology hardware providers;

Seagate Technology Holdings and Western Digital Corp., due to an improved industry supply versus demand environment which is translating to more favourable pricing. We also bought shares of semiconductor maker Microchip Technology Inc. amid expectations of a bottoming of inventory cycle and recovery in cyclical markets. Lastly, we newly purchased Celestica Inc., a designer and manufacturer of electronic components, given the potential for incremental growth related to AI switching, servers and storage opportunities. These new buys were funded in part via full exits to software companies; Dynatrace Inc., a software intelligence maker, Hubspot, Inc., a cloud-based relationship management provider and Palo Alto Networks, Inc. a cyber platform, following a rally in the industry and expectations of better near- term opportunities in other areas of the market. We fully exited our position in MongoDB Inc., an open-source database platform, due to concerns of less attractive valuation and near-term growth potential.

Market Outlook 

Our expectation is that the risk and reward within technology stocks may remain favourable considering the underlying fundamental factors, with macroeconomic uncertainty recently coming down and potential interest rate cuts, which are anticipated in the coming months, which will likely help further improve industry prospects. The upcoming quarterly earnings cycle is likely to drive investor sentiment incrementally, particularly in terms of forward guidance from companies. Although near-term uncertainty may preside, we maintain a positive mid-to-long-term outlook for equity markets and we continue to believe market leaders who execute well are likely to be rewarded regardless of the macroeconomic backdrop.

Our focus remains on building the portfolio from a bottom-up perspective with a macro- overview. Technology remains a key enabler across almost every vertical industry, and we will continue to seek stocks which solve difficult problems and can be long-term outperformers. Despite short- term periods of higher volatility, earnings growth ultimately drives stock prices over the long term, and in our view, we are still early in the spending trend supporting this dynamic segment.

Mike Seidenberg
11 July 2025

This is no recommendation or solicitation to buy or sell any particular security. Any security mentioned above will not necessarily be comprised in the portfolio by the time this document is disclosed or at any other subsequent date.

Awards & Ratings

A ranking, a rating or an award provides no indicator of future performance and is not constant over time.