It’s finally time to buy Scottish Mortgage again

However, the Baillie Gifford flagship is making a sustained recovery, up 44pc from last May, when the shares sank to around a three-year low of 612p. 

This is also 36pc higher than last October when we again recommended a buy at 651p on an 18pc discount. Over 10 years Scottish Mortgage remains the best performer in its sector, returning over 355pc to shareholders, well ahead of the 222pc advance in the MSCI World index.

Fund managers Tom Slater and Lawrence Burns told investors this week the buyback plan did not signal that they had run out of investment ideas.

The backers of “Magnificent Seven” stocks Amazon, Meta, Nvidia and Tesla were “excited” and “enthusiastic” about opportunities in artificial intelligence and the impressive advances of semi-conductor supplier ASML, its top position at 8pc of assets, and Elon Musk’s SpaceX, a 4pc holding.

With cashflow and profits from the portfolio surging, the outlook is brighter for Scottish Mortgage than it has been for some time. 

The prospect of lower interest rates this year lifts the pressure on valuations while the revival of flotations after a two-year gap should enable the fund managers to lock in gains if some of its private companies go public and reduce the trust’s large 26pc exposure to unquoted stocks. 

All this with a large investor pushing for moves to further narrow the discount from its current 6pc.

Questor says: Buy this high-risk, high-return fund for the long term but take profits when they occur.

Ticker: SMT

Share price at close: 884.4p

Gavin Lumsden is editor of Citywire’s Investment Trust Insider website 

Read the latest Questor column on every Sunday, Monday, Tuesday, Wednesday and Thursday from 8pm

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