Why British investors are pouring into US tech funds this year
British do-it-yourself investors are pouring back into technology funds this year in a bid to cash in on a tech-fuelled market rally in the US and Asia.
Stateside markets have rallied hard on the back of a surge in tech stocks in recent months as investor confidence turns back to so-called growth firms after a torrid performance last year.
The tech-heavy Nasdaq 100 is trading up nearly 27 per cent over the past six months, pushed higher by the sudden boom in interest in artificial intelligence and a surge in value for firms like chipmaker Nvidia, which topped $1tn valuation in May.
Analysts at retail investment firm Hargreaves Lansdown said the market boost has seen British retail investors on its platform pour back into tech funds.
“In the US in particular, the tech top performers have posted spectacular gains – Facebook parent company Meta, electric vehicle behemoth Tesla and top-of-the-pops is global artificial intelligent firm Nvidia,” said Emma Wall, head of investment analysis and research, Hargreaves Lansdown.
“It is therefore not surprising to see investors snapping up tech funds and trusts, in a bid to get a piece of the action.”
Amongst the most bought funds on the platform in recent weeks are tech-heavy Baillie Gifford American and Legal & General US Index, as well as specialist funds Legal & General Global Technology Index and Liontrust Global Technology.
Hargreaves Lansdown’s most bought investment trusts showed a similar tech tilt, with Allianz Technology Trust and Polar Capital Technology Trust topping the pile.
Japanese funds have also proved a hit as the Nikkei surges to its highest level and bumps up confidence in the region.
The Nikkei 225 index is trading up nearly 20 per cent in the past six months to reach near 30 year highs.