Performance, Commentary & Portfolio

Fund Manager’s Review

Portfolio overview

Allianz Technology Trust’s Net Asset Value (NAV) total return was -4.33% in March, compared to the Dow Jones World Technology Index return of -5.01% in GBP.

Equities were pressured across the globe as the United States-Israeli war against Iran spread throughout the Middle East, with oil and gas prices soaring, clouding the outlook for inflation and diminishing expectations of further monetary easing from key central banks. Within technology, all industries were lower for the month with electronic equipment and communications equipment among the top relative performers, while interactive media and technology hardware industries lagged.

Monthly relative performance was aided by a combination of stock selection and industry allocation impacts. Results were led by bottom-up gains in semiconductors, IT services and software, which were partially offset by more conservative stock selection in the electronic equipment industry

Contributors

Our position in Cloudflare, Inc., a provider of cloud‑based network and edge security that mitigates and accelerates internet applications, aided results as shares reacted positively to strong revenue growth, rising artificial intelligence (AI)‑driven traffic, and partnerships highlighting the company’s role as a security layer for AI‑enabled workloads.

The avoidance of SK hynix Inc., a South Korean memory maker, contributed to relative returns as shares were impacted by the Iran war and corresponding increase in energy prices given the company’s reliance on oil, natural gas, and chemical gases which flow through the Strait of Hormuz.

Our decision to own the ADR (American Depository Receipt – US dollardenominated certificates representing shares of a foreign company, trading on American stock exchanges) of Taiwan Semiconductor Manufacturing Co. Ltd. – the world’s largest pure-play semiconductor foundry, manufacturing advanced chips for leading AI, mobile, and high-performance computing customers – relative to the benchmark which owns the local shares, also favourably impacted results given the weighting differences and return differential between the two share classes.

Our active position in Sandisk Corp., a manufacturer of memory and USB drives for photography, gaming, and data centres, contributed to relative performance as the company continues to show order and pricing resilience, fueled by supply tightness and durable demand drivers.

Shares of KLA Corp., a provider of process control, inspection, and metrology tools that are essential for advanced semiconductor manufacturing and packaging, aided results on a relative basis given optimism around rising fab (factories where integrated circuits are manufactured) and advanced-packaging investment driven by AI workloads.

Detractors

Our active position in Micron Technology, Inc. a maker of high‑bandwidth memory chips that are critical for data centres, AI servers, personal computers, and mobile devices, offset results following significant gains in prior months, as investors took profits amid concerns that new AI compression techniques and peak‑cycle fears could reduce future memory demand, despite record earnings and strong AI‑driven fundamental factors.

Shares of MongoDB, Inc., a modern, cloud‑based database platform that enables developers to build and scale applications using flexible, non‑relational data models, offset results following weaker‑than‑expected forward guidance despite beating quarterly results, which raised concerns about slowing growth and continued operating losses.

Our structural below-benchmark allocations to compute and networking semiconductor giant Nvidia Corp. and iPhone and personal computer giant Apple Inc., offset performance as both stocks were only modestly lower for the month due to investor gravitation toward select mega cap names which offered perceived steady growth potential and relatively attractive valuation levels.

Our position in Amphenol Corp., a designer and manufacturer of high‑performance electronic and fibre‑optic connectors and interconnect systems used across data centres, AI infrastructure, automotive, industrial, and defence markets, detracted from results due to macro‑driven selling, tied to inflation and geopolitical concerns, profit‑taking after a strong run, and investor caution around near‑term guidance despite solid underlying demand.

New buys and sells 

Turnover in March was undertaken at a lower-than-typical level as we chose not to overreact to market volatility and given our belief that the portfolio was already well-positioned from a risk versus reward perspective. We newly purchased shares of DigitalOcean Holdings, Inc., a developer‑focused cloud infrastructure provider that embeds core cybersecurity capabilities into its platform rather than selling stand‑alone security software, given the company’s secular growth potential. We made the decision to fully exit our position in cloud-based web, mobile security and threat protection leader Zscaler, Inc. given our preference for other companies with better near-term catalysts. We also sold our stake in connected devices, cloud hosted software, and AI-enabled data provider Samsara, Inc. amid expectations of lower conviction and a potential moderation in growth.

Market Outlook 

We continue to view the technology sector favourably, underpinned by durable structural growth drivers led by AI and the broadening adoption of AI across enterprise, consumer, and industrial applications. We are becoming increasingly constructive on software and IT services segments of the market as growth prospects remain intact and valuations have compressed relative to history. The market’s broad application of an “AI disruption discount” has, in our view, created an increasingly attractive entry point in high‑quality franchises with recurring revenue, mission‑critical workflows, and expanding AI‑driven product offerings. Corporate fundamental factors remain solid, with many technology companies demonstrating resilient margins, improving free‑cash‑flow profiles, and strengthening forward guidance. While volatility may persist in the near-term, particularly due to an uncertain geopolitical and macroeconomic backdrop, we expect technology to remain a key driver of earnings growth. Looking ahead, we believe high‑quality market leaders with scale, strong balance sheets, and proven execution, are well positioned to outperform.

Mike Seidenberg
31 March 2026

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.