Scottish Mortgage Flexes New Muscles: Buybacks Exceed £2.5bn as Private Market Cap Gets a £250m Cushion
Published on 05/28/2026 at 16:28 | Redaktion boerse-global.de
Scottish Mortgage Investment Trust delivered a net asset value total return of 27.4% in the fiscal year through March 2026, nearly 10 percentage points ahead of its benchmark. But the headline number tells only half the story. Two structural shifts – an aggressive buyback programme that has already blown past its original two-year target and a freshly approved £250m buffer for private company investments – are reshaping how the £13.8bn trust manages its discount, its portfolio mix and its exposure to the next wave of growth.
The buyback campaign has been the more visible lever. Since March 2024, the trust has repurchased more than £2.5bn of its own shares, exceeding the £2bn goal that was set as a two?year target. The effect on the discount has been tangible: the gap between the share price and NAV, which yawned to 23% in mid?2023, has since narrowed sharply. By end?March the discount stood at 9.5%, and by late May the shares had swung into premium territory, trading at 1,528p on the London Stock Exchange and around €17.66 in euro markets – roughly 28% higher than the start of the calendar year.
Those buybacks are set to continue. The board has reaffirmed its commitment to dampen discount volatility, even as the trust now finds itself in the unusual position of having to manage demand rather than a persistent gap. The shares recently traded more than 9% above their 50?day moving average.
On the private markets side, the trust has given itself greater strategic breathing room. Shareholders voted in April to supplement the existing 30% cap on unlisted holdings with a £250m buffer – a safety valve that allows the managers to keep positions that balloon in value without being forced to sell prematurely. The policy change effectively raises the ceiling to around 35% of the portfolio. At current valuations, private investments account for 27.1% of assets, so the buffer is still largely untapped. But the need is clear: when a private holding such as SpaceX rallies sharply, as it has, the portfolio can quickly hit its limit.
Should investors sell immediately? Or is it worth buying Scottish Mortgage Investment?
SpaceX is now the trust’s largest single position, representing 19.3% of the portfolio – equivalent to roughly £3bn. The stake surged 179% over the fiscal year as the company continued to scale its Starlink and Starship operations. Now the market is watching for an initial public offering at the Nasdaq, which is widely expected as early as June 2026. Analysts at Winterflood estimate that a SpaceX IPO at a target market capitalisation of $1.75tn could add a further 7% to Scottish Mortgage’s NAV.
The AI theme runs alongside the space bet. Manager Tom Slater described the current build?out of AI infrastructure as the most significant structural shift since the internet’s arrival. Anthropic, a portfolio holding, saw its annualised revenue rocket from $1bn in January 2025 to more than $30bn just fifteen months later. Among listed investments, TSMC and ASML contributed gains of 99.1% and 94.2% respectively, while Nvidia added 57.5%.
The trust’s finances remain measured. Ongoing charges stand at 0.33%, with no performance fee. Gearing was trimmed to roughly 11% and the average cost of debt is 3.6%. The dividend was lifted by 4.3% to 4.57p per share – the 43rd consecutive annual increase – with a final payment of 2.97p due on 10 July. Management noted that portfolio companies’ free cash flow has more than doubled year?on?year, suggesting that the underlying holdings have adapted to the higher interest rate environment.
All eyes now turn to the annual general meeting on 2 July in Edinburgh, where the question of how and when to monetise the SpaceX holding will dominate. A standard six?month lock?up after the IPO is expected, after which the trust could sell 20–30% of its stake in the second half of the fiscal year. The half?year report will be the first real test of whether the momentum from this strong fiscal year can be sustained – and whether Scottish Mortgage’s repositioned playbook can keep delivering.
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