The most anticipated IPO in history delivered its expected windfall, yet Scottish Mortgage Investment Trust’s shareholders suffered one of the worst weekly routs in months. SpaceX, the trust’s largest holding at 21% of net assets, made its Nasdaq debut on 12 June at a valuation of up to $1.8 trillion (with secondary article noting over $2 trillion). The listing transformed an illiquid private bet into a tradeable security, unlocking liquidity and slashing portfolio risk. But the stock failed to catch any tailwind. Instead, it tumbled 5.7% on the week, closing on Friday at €16.12 and slipping below its 50-day moving average.
The culprit was the US jobs report. May payrolls surged by 172,000 — double the consensus forecast — crushing expectations that the Federal Reserve would cut rates soon. Markets now price the first reduction no earlier than December 2026 and even assign a rising probability of further hikes. Growth-focused portfolios are acutely sensitive to such shifts, and Scottish Mortgage, with its heavy tilt toward unlisted technology names, was caught in the downdraft. The year-to-date gain has been trimmed to around 16%.
Thursday saw the shares trade ex-dividend. The final payout is 2.97p per share, part of a total distribution of 4.57p for the year — marking the 43rd consecutive year of rising dividends and maintaining the trust’s spot on the “Dividend Heroes” list. The cash is due to be transferred on 10 July 2026. However, the sustainability of that record is under scrutiny: the total dividend bill of roughly £49.6m comfortably exceeds the net income of £25.6m, leaving a gap that critics are quick to highlight. A separate buyback programme, designed to kick in when the share price falls below net asset value, will also be put to a shareholder vote.
The real inflection point comes on 2 July, when the annual general meeting in Edinburgh will decide the trust’s future strategic direction. The board is seeking approval to raise the cap on private-market investments from the current 30% of assets. Because existing unlisted holdings have already grown to more than 40% through valuation gains, the management team — led by Tom Slater and Lawrence Burns — argues that the limit is too rigid. Without flexibility, the trust risks being forced to dilute its stakes in promising start-ups when they raise follow-on funding. A successful vote would grant the managers significantly more room to pursue late-stage tech bets.
Should investors sell immediately? Or is it worth buying Scottish Mortgage Investment?
The private-market environment remains challenging. A recent report from Bain & Company flagged a valuation correction in the software sector, with equity values in private-equity portfolios falling by 8%. Against that backdrop, the trust’s exposure to more than 40% of its assets in unlisted growth companies is under the microscope. But further portfolio IPOs could alleviate pressure. Both OpenAI and Anthropic, two of the most closely watched artificial intelligence developers, are seen as potential candidates to go public in the coming months — moves that would directly bolster Scottish Mortgage’s balance sheet in the second half of the year.
Meanwhile, a new heavyweight investor has emerged. Mitsubishi UFJ Asset Management bought more than 33.6 million shares in early June, crossing the 3% disclosure threshold. The Japanese asset manager’s accumulation suggests confidence in the trust’s long-term thesis, even as short-term macro headwinds batter the stock.
Despite the current turbulence, the trust’s decade-long record remains formidable: net asset value has surged 435% over the past ten years. The July vote will determine whether management can continue to take the big, illiquid bets that have driven that outperformance — or whether shareholders will demand a more conservative path.
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