The supersonic passenger-carrier, built jointly by UK and French manufacturers, had a cruising speed of 1,350 miles per hour, which was more than twice the speed of sound. This meant an average flight from London to New York took less than three and a half hours, rather than the usual eight. Its fastest recorded time was two hours, 52 minutes, and 59 seconds!*
However, the iconic aircraft was retired in 2003 for various reasons, including the fact it was noisy and so expensive to operate that it proved economically unviable. Although Concorde is no longer around, there have been plenty of other technological advances over the last 20 years that have transformed our lives.
Here we look at the companies whose products and services have made the world a faster, better place, and the investment funds backing them.
Twenty years ago, going online was an arduous process. This was back in the old dial-up days when an internet connection was made via your home telephone line. Today, people can access rapid 5G networks via their mobile phones from virtually anywhere – and the download speeds achieved are constantly improving.
One of the biggest names in this ever-changing industry is US-based Broadcom, which designs, develops and supplies semiconductor and infrastructure software solutions. Broadcom is among the 10 largest holdings in the AXA Framlington Global Technology fund**, which has been successfully managed by Jeremy Gleeson since 2007. This fund invests in technology companies from around the world and we like Jeremy’s level-headed commitment to finding new opportunities with strong commercial potential.
Every manufacturer on the planet has been developing better equipped, safer vehicles over the past couple of decades. However, the biggest development has been in electric vehicles. Sales of them exceeded 10 million in 2022, meaning 14% of all new cars sold were electric***, according to data from the International Energy Agency.
The biggest name in this field is Tesla, run by co-founder and chief executive Elon Musk, which produced nearly 480,000 vehicles**** during the second quarter of the year. Tesla is currently the fifth largest stock position in the Baillie Gifford American fund**, according to its most recent fact sheet.
This fund is run by a team of four co-managers who focus on the small number of US companies that are capable of creating exceptional returns. They look for absolute winners, so want to find the best companies and back them with conviction, with excellent returns having been generated for investors in the past.
Can you remember a time when we didn’t have smartphones in our pockets? A number of manufacturers have played a part in the story but Apple has established itself as the clear leader.
Its iconic iPhone first appeared 16 years ago, and the US tech giant has been making these devices quicker and better equipped ever since. In fact, iPhones are so important to the company that they now account for just under half of its sales*****, according to its most recently published results.
Apple is one of the 10 largest holdings in the Brown Advisory US Flexible Equity fund**, which has been run by Maneesh Bajaj since 2017. The fund enjoys an unconstrained strategy, which enables the manager to select companies from across the market cap spectrum. Although finding funds with long-term outperformance of the S&P 500 is very difficult, this strategy has been successfully doing so for more than 25 years.
Phenomenal technological developments over the past two decades have transformed the computer and gaming industries. The global video game market size was estimated at $217.06bn in 2022^ and is expected to grow at a compound annual growth rate of 13.4% from 2023 to 2030^, according to Grand View Research. The report attributed the expansion to the ongoing trend of online gaming, the emergence of high bandwidth network connectivity, and the continuous demand for 3D games.
One of the biggest names in the video game world is Nintendo, which is one of the 10 largest holdings in the Baillie Gifford Japanese fund**. This portfolio has been one of the most consistent funds in its sector and has proven itself in many different market environments.
Elsewhere, there’s tech giant Microsoft. As well as being behind the launch of Xbox, the video gaming brand, it’s also a leading international software provider. This US-based company has the largest stock position in the Morgan Stanley Global Brands fund**, which looks for high quality companies with defendable and visible future earnings.
Satellite television changed how we watched the box when it arrived in the 1980s, but it’s been the video streaming services that have been the real revolution.
Being able to watch a dizzying array of films, series and documentaries whenever you want has been an absolute game changer in recent years. One of the leading names is Netflix, which currently boasts 238 million global streaming paid memberships^^, according to its recent results.
Netflix is one of the largest stock positions in the GAM Star Disruptive Growth fund**, which invests in companies expected to benefit from technological change. The fund’s manager, Mark Hawtin, has a strong background in the technology sector, and uses this to identify key themes in this area. We like the fact this portfolio is positioned to be on the right side of change making it a compelling offering without betting the house on one dominant theme.
One area we haven’t examined yet relates to the components that are helping to drive forward many sectors. Semiconductors play crucial roles in numerous products and one of the main global providers is the Taiwan Semiconductor Manufacturing Company.
This stock is the largest holding in the Matthews Pacific Tiger fund**, which aims to invest in high quality companies for the long term. This is a core Asian equity fund that’s run by a well-structured and well-resourced specialist team. We like its ability to differ from the benchmark and its aim to invest in long-term Asian winners.
*Source: British Airways, Celebrating Concorde
**Source: fund factsheet, 31 August 2023
***Source: Global EV Outlook 2023, International Energy Agency
****Source: Tesla Financial Results, 2 July 2023
*****Source: Apple Financial Results, 1 July 2023
^Source: Video Game Market Size, Share and Growth Report, Grand View Research, 2030
^^Source: Netflix Financial Results, 15 September 2023
Past performance is not a reliable guide to future returns. You may not get back the amount originally invested, and tax rules can change over time. The views expressed are those of the author and fund managers and do not constitute financial advice.