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Buy long-term growth at a discount via Allianz Technology Trust

Allianz Technology Trust could provide a cheap entry point into tech stocks
Buy long-term growth at a discount via Allianz Technology Trust

The recent market volatility has included some sharp falls in the share prices of technology companies. But this doesn’t mean that there is anything fundamentally wrong with companies in this sector. “Facebook (US:FB), Apple (US:AAPL), Amazon (US:AMZN), Netflix (US:NFLX) and Alphabet (US:GOOGL) are down from their highs and the froth looks as though it has been blown off,” says Rupert Thompson, chief investment officer at wealth manager Kingswood. “While they may well remain volatile… the fundamentals behind the tech sector remain strong and valuations are once again looking more reasonable.”

IC TIP: Buy at 2340p
Tip style
Growth
Risk rating
High
Timescale
Long Term
Bull points

Unusually wide discount to NAV

Strong performance

Well positioned for growth

Experienced manager

Bear points

Performance fee

The pullback has also affected the valuations of funds that invest in technology stocks, so if you are a long-term growth investor with a high risk appetite this could be a good moment to add to one. Options include Allianz Technology Trust (ATT), which was trading at a discount to net asset value (NAV) of 5.8 per cent at close on 22 September – a good deal wider than the slight premiums or discounts it has typically traded at over the past few years. And when markets are calmer and sentiment is stronger, the discount could tighten again.

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